Comment Re:Why would they fund it in the first place? (Score 2) 329
Actually, ordinary loans from banks are exactly the same as loans from the Fed. When an ordinary commercial bank makes a loan, they are also effectively printing money digitally. By definition, with a reserve ratio of less than 100% and outstanding loans more than the total assets on reserve, money must have been created to make those loans. In short, "borrowing" from a commercial bank (loan, credit card, line of credit) is also not "real borrowing". Take a look at http://www.positivemoney.org/ for one explanation of why that is the case (yes, that is a UK based site, but the central bank system is the same in the UK). There are plenty of others out there.