Here you can see the big difference between China and USA: Since newly printed money belongs to Chinese government (they own the central bank) , their government will never have this problem, just like FED will never run into debt (Why FED is an exception of fiscal discipline? )
When debt ceiling can not be raised and the government ran out of choice, they might ask FED to write off their debt. If FED does not agree, they could remove FED and start to print money for themselves (There is no really good reason why FED can print money for themselves while government can not), that will become a huge event
When debt ceiling can not be raised and the government ran out of choice, they might ask FED to write off their debt. If FED does not agree, they could remove FED and start to print money for themselves (There is no really good reason why FED can print money for themselves while government can not), that will become a huge event
The government does effectively print money for itself, through the creation of bonds. The bonds are then bought with the newly-printed fed money. The only problem with this plan is that the debt ceiling will need to be raised periodically. After all, what exactly is the Fed going to do when a bond finally pays out? Buy more bonds with this new money, obviously. So the fed really isn't printing its own money at all, it is printing the government's money, while giving a bunch of bankers a small cut to make it look like its some sort of stimulus project rather than a money printing scheme to finance government debt.
It seems that many people have the impression that FED do not print money for themselves, I don't know where is the root of this knowledge, is it from economy books?
https://bitcointalksearch.org/topic/m.3281251
