That's not really accurate, the parent comment is much more accurate, but like all things in complex economies, the details get complicated fast. The Fed certainly has some control, but not like you imply(also one needs to define money supply, as there are multiple kinds involved in the US system).
It's the Treasury that's responsible for paying Congress's spending, not the Federal Reserve. They don't get to invent money, though they do get to print it and they do get to create it through borrowing.
Expansion through private debt used to be limited by bank reserve ratios. Of course now that reserve ratio is nominally 0, the limit imposed on this expansion is a little more vague and uncertain.
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>Used to as in when the currency was gold backed and not really fiat, you mean? Sure, but that also didn't work very well.
I'm talking about fractional reserve banking. In 2020 the reserve ratio was eliminated (set to 0%). Was not at all referring to gold backed or gold standard.
Used to as in when the currency was gold backed and not really fiat, you mean? Sure, but that also didn't work very well.
Loans in a fiat currency are not limited by reserves. If there is high demand for money, private institutions will lend money and then borrow reserves at whatever rates they get to cover the difference.
It's the Treasury that's responsible for paying Congress's spending, not the Federal Reserve. They don't get to invent money, though they do get to print it and they do get to create it through borrowing.