Even at Forbes, money is debt?

Forbes:

Every dollar in your wallet is a Federal Reserve Note, a sign that the Fed owes you. It is an interest-free loan from you to them that they can never pay back. And when the Fed gives the government their notes, these interest-free IOUs, they get an interest-bearing Treasury bond in return. It doesn't matter how much the interest is, the Fed is guaranteed to make money.

My dollar is an interest-free loan from me to the Fed? Dollars in my wallet being "notes" is a sign that the Fed owes me??

The Fed doesn't owe me shit. Someone with an agenda is making bad argument.

That's okay. Elsewhere in the article the guy says this:

The Fed has incurred much financial harm to our nation since its founding.

Incurred? The Fed "incurred" harm to our nation? It's the wrong word.

The guy's an ass.


A Federal Reserve Note is not "debt". Not to the holder, and not to the issuer. Anyone who ever spent a dollar knows it.

As Bossone and Costa write,

Convertibility of banknotes [was] suspended long ago, and the abandonment of the gold-exchange standard, about half a century ago, marked the definitive demise of “debt” banknotes even at the international level.

and further,

A correct application of the principles of general accounting recognizes that money accepted as legal tender is not a financial instrument as defined by the international accounting standards, and therefore cannot be debt.

In days of old when knights were bold and money was first invented, it was useful to have something of value be money. That way, people were likely to accept it. These days, some folks still like the idea. But we already accept money. We accept money as a thing of value.

The trick is to keep the value in the money. But I am convinced that going back on gold, for example, is not the solution. Because going off gold wasn't an arbitrary or spontaneous decision. Going off gold was forced on government by the growth of finance and the concentration of wealth.