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monetize:

2: to purchase (public or private debt) and thereby free for other uses moneys that would have been devoted to debt service

[M-W's Dictionary]

Please explain to me the meaning of above definition. Thanks, in advance.
Comments  
Oxford Dictionary =
monetize(also monetarize, monetarise) • verb 1 convert into or express in the form of currency. 2 as monetized (of a society) adapted to the use of money.

Online Plaintext =
Monetize
(v. t.) To convert into money; to adopt as current money; as, to monetize silver.

Free Dictionary =

Monetize
1. To convert into money.
2. To convert from securities into currency that can be used to purchase goods and services.

I think Merriam Webster #2 is close to Free Dictionary's #2


monetize:

2: to purchase (public or private debt) and thereby free for other uses moneys that would have been devoted to debt service

[M-W's Dictionary]

Hi Feebs,

Actually I must have asked the question in a different way. I can understand the general meaning of above definition. But I couldn't understand the literal Is this correct to use literal here? meaning of the above definition. Like, what does public or private debt mean? And I would have written the expression ''...thereby free for ... debt service'' as thereby setting free the money for other uses, the money that would have devoted to debt service.
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Jackson, it appears no one knows.

I've never used this word before and I don't even remember reading it before. I've lived 41 years without it, and received a masters degree in business without it as well. I think you don't have to worry about this one too much.
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Grammar Geek
Jackson, it appears no one knows.

I've never used this word before and I don't even remember reading it before. I've lived 41 years without it, and received a masters degree in business without it as well. I think you don't have to worry about this one too much.

Hi GG,

Most of the time I run after things which I don't really need in life. I don't know why I do it. Perhaps, it's my thirst for knowledge. But I believe sometimes such a thirst can cause you a problem. Well, I would stop thinking about it.

Kind regards, Jackson
This is a currency conversion of debt (paper, IOUs) into cash. It takes place when e.g. a National Bank 'prints money' (aka. quantitative easing). The National Bank increases the money supply and uses that money to purchase debt that hitherto was sitting in the books of banks. The banks will then find themselves with more cash in their books with which they can set up new loans, thus providing credit to businesses and individuals and starting a cycle of investment and economic growth. As the economy recovers the National Bank would start selling slowly the debt that it has purchased in the market and destroy any money that it receives as payment (contracting the money supply). When it prints money the value of the currency would decrease (more of it to go around) and exports will become competitive relative to other currencies. When it destroys money the value of the currency will increase (it becomes more scarce), so slowing down the economy (money will become more expensive to get hold of, exports less competitive against other currencies). Therefore the National Bank will only contract the money supply when it perceives that the economy is overheating.

Anyway, that's the theory. In practice this does not always work when we find ourselves in an economic depression caused by bad debt (as we are now) because banks are reluctant to expose themselves to more (potentially) bad debt.

HTH.
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Regards,
Mick