What Makes it "Rel Money"?
The premise of some movies and novels revolves around counterfeiting paper currency. "The A Team" comes to mind as stealing printing plates is the charge that keeps them on the run (tbut hey didn't do it).
The reason given for fighting counterfeiting is that flooding the economy with fake money will dilute the money supply and devalue the currency. The Nazis actually tried to do that to England in WW-II, but they couldn't bring it off.
Today, the US Treasury Department issues bonds and someone, China India or the Federal Reserve "buys" hem. . . . inflating the money supply. But the "money seems (to me it seems) to come out of thin air. No printing takes plce. It is all digital record keeping. So how do we know it is "real money"?
What is there to keep an unscrupulous person from making an arrangement with corrupt officials at the National Bank of Kazakhstan, or The Royal Bank of Swaziland, and have them wire transfer a non-existent chunk of US Dollars to an account is the Camen Islands? How would anyone at the receiving bank know that it is just a bogus transaction with nothing being transferred? How doe money just appear?
This is said half in jest, and I admit to being both ignorant and naive, but that seems to be exactly what has been happening here in the US between the Fed and Treasury, with the trillions of dollars pumped into our economy by every administration going back to Bush 43 ("W") and earlier.
I welcome technical comments on this from anyone with working knowledge of finance and banking, regardless of whether we have ever agreed on anything political on this forum before.
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