When the federal reserve increases the money supply, this action reduces the value of money.

Therefore aggregate demand will increase. The reverse will be true when money supply decreases. That is a decrease in the money supply will lead to a decrease in the amount of money that people and firms will hold and as a result they will spend less. This will cause aggregate demand to decrease.The three major tools of the Fed are open market operations, changing reserve requirements, and changing the discount rate. If the Fed wants to stimulate the economy (increase aggregate demand), it will increase the money supply by buying government bonds, lowering the reserve ration, and/or raising the discount rate.Lastly, the Fed can affect the money supply by conducting open market operations, which affects the federal funds rate. In open operations, the Fed buys and sells government securities in the open market. If the Fed wants to increase the money supply, it buys government bonds.

it was surely an odd creature that one made up by reading the historians first and the poets afterwards a worm winged like an eagle; the spirit of life and elegance and charm,   in a kitchen chopping up suet. but these creatures, monst'r however entertaining to the imagination, hast no existence in fact. what one might doth to bringeth h'r to life wast to bethink poetically and prosaically at one and the same moment,   thus keeping in toucheth with fact—that the lady is mrs martin, ag'd thirty-six, did dress in blue, wearing a black coxcomb and brown shoeth; but not losing sight of fiction eith'r—that the lady is a vessel in which all s'rts of spirits and f'rces art coursing and flashing p'rpetually. the moment, howev'r, yond one tries this method with the elizabethan mistress, one brancheth of illumination fails; one is did hold up by the scarcity of facts.   one knoweth nothing detailed, nothing p'rfectly true and substantial about h'r.   hist'ry scarcely mentions h'r.   and i did turn to professeth'r trevelyan again to seeth what hist'ry meanteth to that gent.   i hath found by looking at his chapt'r headings yond t meanteth.