That said, here is the response of the guy who wrote the article:
The Fed buys securities and pays for them with money they created out of thin air. These transactions occur as Securities Sold Under Agreement to Repurchase on the Seller's (Banks") books. It is Money and Banking 101, done under Open Market Operations. The poster is wrong.
That's fine but you did seem to think that stock repos could boost the market. They can't.
That said, here is the response of the guy who wrote the article:
You e-mailed this guy?
The Fed buys securities and pays for them with money they created out of thin air.
Yes, Treasury securities not stocks.
This is true, only sometimes they don't even use the air.
When you walk by a bank and you see painted on the glass "Assets over $3,000,000" you may be imagining that inside the bank is a money bin bigger than Scrooge Mc Duck's. The fact is that when you deposit $10 in the bank, your deposit is not an asset (to them), it's a liability. The banks assets are the loans the bank has made.
You and I create money out of thin air too; in fact most money is created by ordinary citizens like us. Every time you loan someone money (or put it in the bank, buy a bond, etc.) you keep your money in the form of the asset, and the recipient now has money that didn't exist before the loan was made. Interest rate hikes and cuts can help us or keep us from creating money. The Fed has an effect on interest rates but not nearly as much as it wants us to think --we have the most power because we have most of the money.
People often get money confused with wealth. You can have a stack of twenties on the table and owe it to the bank --you've got money and no wealth. There are other people who have wealth and no money --every once in a while we hear about a farmer who's land-poor, meaning all land no cash.