Hi there Danhoff These are good questions and there are answers...

Hi there Danhoff

These are good questions and there are answers which are straight forward when you understand that the Fed is the banker for the US commercial banks.

1) the US govt is running a deficit of between 500B and 1 Trill a year for the past years and going forward forever; how does the US govt pay $1 Trill a year more than it gets without fiat money

The US Treasury issues bonds. (That is a separate matter to the Fed. You need to look at US budget .)

2) the FED balance sheet is now at 4.3 Bill; how did these assets 'appear'

The assets were purchased directly from the commercial banks. The money the commercial banks received for the bonds was either redeposited with the Fed, or left uninvested in the commercial bank clearing accounts with the Fed. The commercial banks have effectively lent the Fed money to pay for the bonds.
Have a look at:
http://www.federalreserve.gov/releases/h41/

3) the banks in the US are awash with money (reserves); where did this money 'come from'

They received the money in payment from the Fed for bonds sold to the Fed, and effectively funded those payments by redepositing the money with the Fed. (Another way of saying what I said in answer to question 2.)

4) high end assets (like share markets and high end art and high end goods) have exploded in value; where did the money come from to buy these assets

This money came from the commercial banks, no the Fed. When the buyer of shares settles, they take money from their bank and pay the seller, who deposits the funds with their own bank. The net movement of funds in the commercial banking system for the transaction is zero regardless of the price at which the shares are sold. One bank has lost the settlement amount, the other bank has gained the settlement amount. The Fed doesn’t have to provide any new money for shares to increase in value. (Shutting down QE will not directly influence the prices of US equities.)

I hope that answers your questions.

Cheers