Below please find part of Perry vs. US -294 US 330, from 1935, a court case involving the debt instruments of the US, and whether they could be paid back in currency rather than gold.
5. By virtue of the power to borrow money "on the credit of the United States," Congress is authorized to pledge that credit as assurance of payment as stipulated -- as the highest assurance the Government can give -- its plighted faith. To say that Congress may withdraw or ignore that pledge is to assume that the Constitution contemplates a vain promise, a pledge having no other sanction than the pleasure and convenience of the pledgor. P. 294 U. S. 351.
6. When the United States, with constitutional authority, makes contracts, it has rights and incurs responsibilities similar to those of individuals who are parties to such instruments. P. 294 U. S. 352.
7. The right to make binding obligations is a power of sovereignty. P. 294 U. S. 353.
8. The sovereignty of the United States resides in the people, and Congress cannot invoke the sovereignty of the people to override their will as declared in the Constitution. P. 294 U. S. 353.
9. The power given Congress to borrow money on the credit of the United States is unqualified and vital to the Government, and the binding quality of the promise of the United States is of the essence of the credit pledged. P. 294 U. S. 353.
10. The fact that the United States may not be sued without its consent is a matter of procedure which does not affect the legality and binding character of its contracts. P. 294 U. S. 354.
11. Section 4 of the Fourteenth Amendment, declaring that "The validity of the public debt of the United States, authorized by law, . . . shall not be questioned," is confirmatory of a fundamental principle, applying as well to bonds issued after, as to those issued before, the adoption of the Amendment, and the expression "validity of the public debt " embraces whatever concerns the integrity of the public obligations. P. 294 U. S. 354.
Hope that helps.
It may be true, but the two are certainly linked, and there is the slight problem of every federal reserve note in existence being insufficient to pay off the debt to the federal reserve, it is in a sense similar to coal-companies that tried to pay workers in their own credits for the company store, which could be inflated to rates which made them functionally slaves. (I think there is a USSC ruling or two on the practice.)
The purpose of the clause. The Federal Reserve holds debt instruments of the United States, and does not normally create them.
Yes, it holds the debt instruments but IIUC charges their own fees and is functionally unaccountable to Congress which delegated that power to them -- it is certainly Congress's ability to incur debt, and to value currency, I am not disputing that. Though I would raise the question of the legitimacy of a system which delegates the power to someone else and denies that someone else to be held accountable (or to all the restrictions of the authorizing agency).
Further, there is the mention of Gold and Silver in the Constitution; the use of Federal Reserve Notes for a state making payment for anything seems like it would be contrary to the Constitution.
Art I, Section. 10.
No State shall [...] coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts [...]