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Message:: [QUOTE="Numbers, post: 1206629, member: 11668"]I don't know much about Greece et al., but I wanted to chime in and correct this.  U.S. Notes are precisely debt owed by the U.S. Treasury--they're little pocket-sized pieces of the national debt.  Indeed, in the post-Civil War era, the USNs made up a substantial fraction of the whole federal debt, so that they became a major political football, with the rich wanting them abolished (deflationary) and the populists wanting their issue expanded (inflationary). The upshot of that debate was that the outstanding amount of USNs was fixed at a specific number in the neighborhood of $320 million.  At the time, that number was sizable compared to the whole national debt.  Fast-forward to the 1960s: that same cap was still in effect, but it was by then a negligible sliver, both of the debt, and of the currency in circulation.  That's why the USNs were finally done away with--they had become pointless, a few tiny droplets in a sea of FRNs and Treasury bonds. Bringing back USNs and substituting them one-for-one for FRNs would result in no net change to the government's debt (since FRNs are in practice backed by Treasury securities anyway), or even to the government's expenses for debt service (since interest paid to the Fed winds up back in the Treasury anyway).  But it *would* put monetary policy back under direct political control, which probably isn't a good thing for the economy....[/QUOTE]