You can sell shares.

They might have issued maybe they issued a million bonds where each of those essentially represent a debt of 80.

Bellwether signs again.

And so when the Federal Reserve or any Central Bank prints money, and it buys debt, it goes out into debt markets and it buys it, it usually buys the safest kind of debt, but that affects all of the debt markets, it goes out and buys in the debt market, they're essentially shifting the supply curve of money to the right, they shift the supply curve to the right.

External debt something that I can tell you a long story about because I personally worked on one of the biggest debts on the continent has come down dramatically.

Maybe debt that you have to pay in the next year.

And just for the sake of it,

And we talked about that if the Fed or the reserve bank wanted to increase the money supply, it could essentially just print new notes and it would have offsetting notes, outstanding liabilities, and then it could use those to perform open market transactions and it essentially allows it to grow the monetary base with the economy or with the needs of different projects out there so that those projects happen.

Some percentage of these borrowers are going to default on their mortgage.

They would actually owe this extra 1 million.

But this I just want to show you some data here.

The bank was profitable.

All we did was, we paid the interest on the debt in this example.

These are the people who first lose money.

That's insolvency.

It can do it through debt or equity.

America's foreign debt shot past 500 billion.

Because the government now owns 90 something percent of the company.

100 million was a huge milestone for us back then.

Some new assignment.

Our new mission required it.

And of those 20 that default, we have a 50 recovery.

So all ended up inside the Special Purpose Entities .

It allows let's say this group of borrowers let's say this pool of borrowers right here actually didn't

So that's bankruptcy.

You go get bankruptcy protection.

You're still solvent.

They serviced the loans.

Our economy grew from 2000 to 2007 on the back of consumers massively overborrowing.

We've spent the last couple of years pondering this, making a list of the different things that we had to do, and so we developed a new technology,

So it buys, it buys debt.

And to stop it crashing over the last two to three decades, we've expanded the money supply, expanded credit and debt, so that people can keep buying stuff.

Instead of all of that we thought there is something new needs to be invented.

That's where the 1 billion comes from.

And because it's a junkier rating, no one is going to want to buy it.

We would just know that there is a 20 chance.

that rectangle is much larger than it should be relative to 1,000, but I think you get the point then I'll do I'll have a liability here that says five gold pieces bank note outstanding.

Payable to the City of San Francisco.

Now let's say that Company x has also borrowed some money.

New stamps will be issued next month.

So they all deposit their 1,000 gold pieces into my bank.

So we still have the same amount of debt.

So that's what we're going to show you in the presentation on collateralized debt obligations.

And maybe the fed is able to, through intervention, first they're able to print money, normally they buy shorter term debt, maybe they start buying longer term treasury debt, and maybe that helps get the yield curve, for longer term treasuries down a little bit.

What happens if let's go to that scenario where we talked before 20 of the borrowers just say, you know what?