Good luck getting an explanation out of this guy. It is not in the interests of the Mandarins to create an system that is readily understandable. They prefer blather on about velocity, the M&Ms, etc, the "scarcity" of money, etc.
Or as John Kenneth Galbraith says: “The study of money, above all other fields in economics, is one in which complexity is used to disguise truth or to evade truth, not to reveal it.”
Secrets of the Temple is a good although pro-Keynesian view of the Fed.
Try Rothbard's "History of Money and Banking in the United States" for an Austrian perspective.
The Creature from Jekyll Island is a pretty wacky tin foil view of the Fed. But I suspect much of the tin foil is true.
Gee, I wish my "Mandarin" status gave me more than this lousy plastic cup. I didn't even have to get into the more technical aspects of the study of money to show your understanding is utterly defective. However, saying let's be even more ignorant about the study of money sure sounds like a convincing argument to me.
I am sure you would rather rely on JKG (an arch-Keynesian) for monetary theory than Milton Friedman. Who could be further from your perspective than JKG?