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Igel

(37,010 posts)
7. They buy Treasury bills regardless of which party's the nominal ruler.
Fri May 30, 2025, 06:54 PM
May 30

But the difference is that they buy bonds and bills. They don't make loans that have infrastructure as collateral or which can be recalled.

When the bonds/bills mature, they're cashed in. That's about the limit of the demand their owners can impose on the US government. The only other thing they can do is (a) stop buying and (b) start selling, which would depress demand and increase the interest rate. It would also depress the value of their holdings, that ol' inverse relationship that usually holds between bond price and interest rate.

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