In response to the coronavirus pandemic, the Federal Reserve took extraordinary and unprecedented action to cushion the economic blows resulting from the global health crisis.
Over the last two years, the central bank expanded the money supply by more than $6 trillion. The pandemic-era round of quantitative easing led to the creation of nearly 50 percent of all new U.S. dollars ever created in the nation’s history.
When Congress approved trillions of dollars in new government spending, whether it was the $2.1 trillion CARES Act or the $1.9 trillion American Rescue Plan (ARP), the Treasury Department issued fresh debt to cover the enormous shortfall. This prompted the central bank to issue new units of currency to purchase the debt….