QE has proven that over the past decade, the only thing that matters for the control of inflation is ultimately the interest rate because it affects the price of all liabilities.

The interest rate is just one way to expand or contract the money supply. This "money supply" is how many units of currency are chasing the amount of goods in the economy. If you double the amount of money, the prices will double. Simple as that. Low interest rates mean that getting money is easy and cheap, and expands the money supply, creating inflation. And the reverse is true. However, if the Fed prints a lot of money that is another mechanism for inflation, and that's precisely why we are in a high inflation context at present.

Reverse repos are sells (it could be the opposite because of their language and my memory). They do it this way to have more precise control over interest rates. Trying to trade Treasuries directly made the effective Fed Funds too wild in the old days.

The reverse repo is when the member banks have too much liquidity and need to park it somewhere, they send it to the Fed and in exchange they get collateral (Treasuries) to hold. This helps them match their assets (the Treaturies) and their liabilities (deposits) better.

There's no currency on the Fed's balance sheet except what they've issued and the float they hold in reserve for bank demand. When the Fed trades, it just marks they buyer with a deposit on its own books or elimates an entry when selling.

Yes. And if everybodyb tried paying off their debts at the same time, all money would disappear and there would still be debt left over.

FedNow only increases the speed of ACH and FedWire unless this is some new thing. Only lower interest rates (higher prices) for the assets they hold may help them, and that appears gone with the China Bubble.

I'm not following you. FedNow is the system of their Absolute Slavery system of CBDC.

As of now, 15% of the Fed's balance sheet are worthless unrealized losses. That means 15% of the money printed by the Fed cannot be bought back and retired in inflation. This is probably the reason why countries have all of the sudden rushed to begin trading without denominating in USD.

The reason is that the US has clearly weaponized its currency with the sanctions over Russia and their committing terrorist acts in order to gain a stranglehold on the world energy markets. Nations are fed up and going to alternatives. The US Dollar is toast.

When a central bank has far more liabilities than assets, it cannot control inflation if holders begin to dump. The common story is like Weimar where new cash (liabilities) are used to pay debts without taking in something as assets. The more unbacked they became, the more they inflated.

But what do holders "dump" in your idea? The USD? They use it to buy what? Or do they dump Treasuries, getting dollars in exchange, then trading the dollars for something else? These details matter.

Turkey is an interesting case because they're forcing hyperinflation by interest rates alone. That normally comes after insolvency. Erdogan is just an ignoramus.

I am not familiar with the situation in Turkey.

Aside from totally voluntary interest rate suicide like Turkey, it's always an asset deficit that permits hyperinflation.

We don't know what percentage because these banks rarely report their data and even rarely honestly.

I agree on that one.