Sounds like they’re not pumping money into the economy, but into the BANKS. Banks don’t directly produce anything but debt...
“Banks don’t directly produce anything but debt...”
Well, in a well-functioning economy, they provide CAPITAL, which businesses need to expand. So the premise is that by lending to businesses, banks facilitate a “virtuous cycle” of borrowing to buy new plant or equipment, which in turn creates jobs, which in turn creates demand for the new goods etc. etc.
But the central implication of your remark is correct: had we instead put dollars directly into the hands of consumers, many would have spent it immediately, while others would have saved it (i.e., put it into banks!). The point being that goosing the economy indirectly through the banks is far less effective than goosing it directly via giving households more money. One could argue that Americans aren’t spending “enough” because they feel overtaxed. Imagine if we had a one-year payroll tax holiday. The economy would skyrocket.