No matter how many times you repeat this error, it still won't be true. The Fed does not buy securities from the Treasury. Sorry.
By whatever circuitous path it takes, our national debt becomes dollars.
The Treasury borrows dollars, so of course the debt is measured in dollars.
The (private) Federal Reserve has the monopoly on creating dollars, and it does so, in considerable part, in exchange for Treasury debt paper. The American tax payer pays the interest on that debt.
The government borrows dollars and of course pays interest on those borrowings. Which has nothing to do with the Fed. Sorry.
Furthermore, the Federal Reserve in turn uses those Treasuries as reserves in its fractional reserve banking system, creating about $10 of new private debt for each $1 of reserves.
The Federal Reserve does not create private debt. The Federal Reserve does not create public debt. Sorry.
So, yes, the Fed certainly doesn't earn all, or even most, of the interest that the government pays on its debt. Most of that interest goes to the other investors, large and small, holding that debt paper.
Glad I could straighten you out on this.
But eventually, all that debt paper (Treasuries) is exchanged for dollars
Bond buyers used dollars to buy the debt in the first place. Of course, when it matures, they receive dollars. They also receive semi-annual interest payments that are dollars.
... No matter how many times you claim I am in error, you are still wrong. The Fed does buy Treasuries. Sorry.The mechanics of U.S. Government debt
When the expenses of the U.S. Government exceed the revenue collected, it issues new debt to cover the deficit. This debt typically takes the form of new issues of government bonds which are sold on the open market. However, the debt can also be monetized by which the Federal Reserve creates an entry on its books to credit the US Government for an amount equal to the dollar amount of the bonds the Federal Reserve is acquiring.