[mohanmcgeek]

> Its not handing out singles, they're using other instruments like buying paper

Infact they're only buying paper.

The handouts are from the federal/state governments. The reserve has to buy the paper for the government to give out these handouts.

[night862]

Yeah the states and local municipalities don't have the fed for handouts (whatever you mean by that exactly, I am assuming it is the unemployment benefits) State/local has to balance their budgets for the most part aside from federal redistribution to "poor" states with less tax revenue.

[mohanmcgeek]

I'm not sure if state/local governments really need to balance their budgets. They can borrow just like the federal government can.

> the states and local municipalities don't have the fed

The federal government too doesn't "have" the fed. The federal reserve is a bank and it's independent of the government.