>You have it exactly backwards. Whoops! You're exactly correct. Issuing more bonds increases the risk of the issuer not being able to repay the debt and thus t

>You have it exactly backwards. Whoops! You're exactly correct. Issuing more bonds increases the risk of the issuer not being able to repay the debt and thus the debtors will demand higher rates to offset this increased risk. Although, unlike other bond issuers, the Fed has other tools in it's arsenal that would allow it to manipulate the yield curve.