I don't have great answers to either of these questions, particularly the latter. Regarding the second question, I think the only reliable guide any of us will have are the FOMC minutes. But doesn't it make sense that if we watch the official measures of inflation and we see inflation is heating up -- from our consumer perspective it has already heated up -- that we can expect the fed to tighten and reduce its bond purchases? Ii could even sell bonds which would drain reserve accounts. When the fed buys bonds as in QE it causes reserve account to swell forcing down the funds rate which of course other rates key off of. It makes sense to me that if the fed sees inflation increasing too rapidly they will want to curb bond buying.
Regarding the first question, I really haven't thought much about this. It's a good question. I'll take a stab at it but please be aware this may be incorrect. I'm guessing that when the fed buys a bond created in the private sector then they are loaning outside money to the private sector expecting it to be paid back with interest. The outside money they use for this purchase could be any combination of newly printed and previously printed outside money. The net result when the bond matures, and the bond originator pays the fed the par value, should be a small decrease in the total amount of outside money spent into the economy equal to the amount of interest paid to the fed by the bond originator.
