If my math is right, under simultaneous secular deflation and govt deleveraging, a central bank would have to be "retiring" money right?
these freeze money rather than destroy? How do you actively shrink monetary base?
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That's what this does. Mostly it's accounting on balance sheets. Never physically exists.
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Though Fed can physically destroy money if they have to (and regularly do so with old bills)
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They sell assets for money, then retire the money they collect
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"retire" is really via reduced circulation. Primary levers are higher reserve ratio and interest rates.
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