There are several definitions of what you can consider money. Physical cash is M0. Including money in your bank accounts gives you M1. In the modern age of elec

There are several definitions of what you can consider money. Physical cash is M0. Including money in your bank accounts gives you M1. In the modern age of electronic banking, M1 is what people broadly think of as money. Treasury bonds are considered M4 money. It's not as liquid as M1, but so long as if you don't want to liquidate it, it isn't much different from M1. >If someone issues debt and exchanges existing money for bonds, there is no change to the money supply. I'm not sure what you mean by this. Issuing debt is creating money. This is true for commercial banks as well. When a bank issues lends you $10k to buy a car, that's money that had never existed before. You receive $10k from the bank. Meanwhile, the bank's depositors are still entitled to withdrawal the full amount they deposited in the bank.