US capital building gets breached. Is this the end?

[Jimjam]

There was a reason I asked who controls the dollar, I’m not an economist, but I genuinely believed the dollar was a fiat currency which means it’s value isn’t dictated, but instead decided by market forces, is that wrong?

[budz2112]

Partly wrong yes, mostly controlled by the federal reserve which is a partly private institution guided by how the market is going, over the last 4 years though we have seen unprecedent government interference ( trump telling the fed chair what to do )

[Jimjam]

How do they control the value of the dollar? How are they guided by the market? Sounds a bit chicken egg.

[budz2112]

Originally Posted by Jimjam [You must be logged in to view images. Log in or Register.]

How do they control the value of the dollar? How are they guided by the market? Sounds a but chicken egg.

By controlling interest rates, and the printing of money, as well as various other measures. Members of the reserve are economists who judge the economy and recommend actions based on its showing. For example over the last 2 years they lowered the rates to 0, and started printing large amounts of money, as well as certain measures of putting cash flow into the stock market. Think buying up bonds and other things like that. I'm not an economist either, but i have a general understanding of what they do

[Jimjam]

How is printed money distributed?

[budz2112]

Originally Posted by Jimjam [You must be logged in to view images. Log in or Register.]

How is printed money distributed?

Its a good question, little more detailed. From what I understand, there are 12 federal reserve banks throughout the US, if you look on the dollar bill the numbers and stuff will say where they came from. They will first be sent to these banks, than from there distributed out to commercial banks based on certain conditions and needs.

[Jimjam]

Originally Posted by budz2112 [You must be logged in to view images. Log in or Register.]

Its a good question, little more detailed. From what I understand, there are 12 federal reserve banks throughout the US, if you look on the dollar bill the numbers and stuff will say where they came from. They will first be sent to these banks, than from there distributed out to commercial banks based on certain conditions and needs.

Banks? So through loans?

[budz2112]

Originally Posted by Jimjam [You must be logged in to view images. Log in or Register.]

Banks? So through loans?

At this point its getting a little over my head, but I would say its based on reserves commercial banks are suppose to operate with, and the account with reserves is debited by the Fed. Dont think it would be considered a loan, because those have rates on them

[budz2112]

I'm not sure on what you mean by protecting the dollar. But to remove money there are things called securities, which is also how they print the money. To print money the fed will buy securities, to take money out of circulation they will sell securities. which is essentially "buying" dollars. Once again very over my head, but i know in general thats how they do it

[Jimjam]

I’m sure Securities are a great idea designed by someone with a much better understanding than either of us.

Thank you for taking the time to enlighten and discuss with me. I told you yesterday we’d have a better time if you had a discussion about something instead of getting dragged into forum bickering [You must be logged in to view images. Log in or Register.] I hope you agree.