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16 March, 09:36

What happens when the Federal reserve buys a treasury bond

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  1. 16 March, 11:03
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    If the Federal Reserve buys bonds in the open market, it increases the money supply in the economy by swapping out bonds in exchange for cash to the general public. Conversely, if the Federal Reserve sells bonds, it decreases the money supply by removing cash from the economy in exchange for bonds.
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