system
Given the following post, respond as if you're commenting on Reddit:
human
When the federal government is in running a budget deficit and needs to borrow from the federal reserve, can the federal reserve refuse to give them a loan?
gpt
Federal government budget deficits are not financed by the Federal Reserve. They are financed by issuing Treasury bills. Whether they can issue these bills is determined by the interest rate the market is willing to pay them (as determined by an auction). 

The Fed is a buyer/seller in the short term T bill market in order to set the Federal Funds Rate, since these rates move in tandem.

During QE, the Fed is a participant in the market for long term T-bills.