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<p>[QUOTE=&quot;medoraman, post: 1307656, member: 26302&quot;]Let me put it this way Inflexion. What would you call a US treasury financial instrument that pays no interest? A US Note? US Notes are still legal tender in this country. What if the treasury ran out of deep pocket investors and started selling US treasuries for $5 face value? What if people started to exchange them for items? This is how US currency started, the first notes were IINTEREST BEARING DEBT. Remember, ALL US CURRENCY IS DEBT, its just a matter of whether it pays interest or not. All US notes outstanding are still listed as liabilities to the US government, as are all FRN&#039;s liabilities to the Fed Reserve.</p><p><br /></p><p>Scale this idea up and you have countries trading billions of dollars of US Treasuries every day. All of these treasuries are identical to the currency in your wallet except they pay interest.</p><p><br /></p><p>Inflexion. I hope you grasp this point. If not, I believe higher level financial discussions will be harder for you than need be. I would have simply PM&#039;ed this to you sir but I thought others may be similarly confused.</p><p><br /></p><p>Chris</p><p><br /></p><p>P.S. Want further proof? They are called Federeal Reserve NOTES, &quot;this NOTE is legal tender for all debts public and private.&quot;. A note legally is debt, its short for promissory note. Even FRN state on their face and in their name they are debt instruments, we are the silly ones accepting debt instruments every day without demanding interest. Its the FRN that are the oddball out, all other treasury debt pays interest.[/QUOTE]</p><p><br /></p>

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