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Originally Posted by satz  By creating weath I assume you mean reserve banking? That could be another topic all on its own. Although that said, it does interest me, does the government have the right to create the currency it wants?
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Yes reserve banking is part of it. But debt itself increases the de facto money supply. For example, I lend you money, you give me a promissory note. I use the promissory note to buy something else. Doing this I essentially double the money in circulation. You still have the money I lent you, I didn't have any more but I still could buy something.
This is the basis for all the derivative financing we read about. There is more "value" (so to speak) in all the derivatives floating around than can be accounted for by the actual money supply (in terms of dollars or whatever).