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While technically true, this is a gross oversimplification.
The value of the keystrokes can and will become worthless if the FED exercises the power too much.
Why?
Simple: Nobody will accept U.S. dollars in payment for goods or services if they think there is going to be a firehose of new dollars created.
The value of the dollar is based upon supply as well as demand.
Without demand, all you've got is so much Monopoly money.
This is why OPEC oil is so central to the USD. It CREATES DEMAND, because you have to have dollars to buy it.
Oh yes ... and TAXES create demand (hence value). There is only one currency in the world that can be used to pay U.S. taxes.
Management of the currency is in fact a balancing act. The base thing we (the great unwashed) have going for us is that the FED does not want to destroy the goose that lays their golden eggs.
“Oh yes ... and TAXES create demand (hence value). There is only one currency in the world that can be used to pay U.S. taxes. “
That insight, plus a gold standard, actually was how Alexander Hamilton transformed America’s virtually worthless Continental Dollar into something valuable and saved the infant country from financial collapse.
When the Constitution replaced the Articles of Confederation the national gov’t gained taxing power, which at the time was the tariff. Hamilton agreed to accept Continentals or gold for payment of tariffs, while promising to pay all interest on Treasury debt in gold specie. The Continental was quickly bid up to par with gold, and there was a great demand for American Treasury bonds because the interest would be paid in gold.
With that stroke Hamilton converted the heavy burden of Revolutionary War debt into an asset. It’s called a Funded Public Debt, and as long as it is kept within a range where taxes can comfortably cover the interest on it it is a good thing for the country.
The rest of your post about the danger of over issuance of dollars is quite true, it was at the root of the inflation of the 1970s. Although I’m not sure that the petrodollar is as important today. And getting away from being the world’s reserve currency might be a good goal.