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Debt monetization is when the government pays off debt via the process of printing more money to pay its creditors.[http://www.investorwords.com/3099/monetizing_debt.html] Debt monetization leads to [[inflation]].[http://www.investorwords.com/3099/monetizing_debt.html] According to Richard Fisher the President of the Dallas Federal Reserve Bank, "Throughout history what the political class has done is they have turned to the [[central bank]] to print their way out of an unfunded liability.[http://online.wsj.com/article/SB124303024230548323.html]
'''Debt monetization''' is when the government pays off debt via the process of printing more money to pay its creditors.[http://www.investorwords.com/3099/monetizing_debt.html] Debt monetization leads to [[inflation]].[http://www.investorwords.com/3099/monetizing_debt.html] According to Richard Fisher the President of the Dallas Federal Reserve Bank, "Throughout history what the political class has done is they have turned to the [[central bank]] to print their way out of an unfunded liability.[http://online.wsj.com/article/SB124303024230548323.html]
[[Fiscal conservatism|Fiscal conservatives]] and libertarians complain that it is larceny on the grand scale.[http://dailyreckoning.com/monetizing-debt-the-grandest-of-larcenies/] Rather than a government repaying what it has borrowed, when a government monetizes debt the a government merely prints up extra currency and uses it to pay its loans.[http://dailyreckoning.com/monetizing-debt-the-grandest-of-larcenies/] When a government debt monetized is it is transformed into an increase in the money supply which decreases the value of its money.[http://dailyreckoning.com/monetizing-debt-the-grandest-of-larcenies/]
==See also==
*[[Debt-to-GDP ratio]]
== External links ==
== External links ==
[[Category: Economics]]
[[Category:Economics]]