Taking Office at Treasury, Geithner Vows Swift Action - washingtonpost.com

Not your Father's Printing Press

The big challenge for Obama and economic recovey is to handle the issue of "printing" money and Geithner's contribution is probably important here. As head of the NY Fed it was his resposibility to increase or decrease the money supply by buying or selling treasury bonds. The government sells bonds to the banks, who sell it to the Fed. The Fed stores it up and can sell it later to reduce inflationary demands. I guess the question is how much can the Fed hold in its books?

Timothy F. Geithner was confirmed by the Senate yesterday as Treasury secretary and will immediately face tough sledding as the Obama administration prepares to spend hundreds of billions of dollars to try to rescue the financial system.

Taking Office at Treasury, Geithner Vows Swift Action - washingtonpost.com