Tuesday, January 12, 2010

Fed posts profit of 52.1 billion dollars

You know I'm sure Fed opponents want to confiscate some of that profit:
The US Federal Reserve said Tuesday it earned a record profit in 2009 of 52.1 billion dollars, enabling a transfer to the US Treasury of 46.1 billion dollars.

The unprecedented results came as a result of the central bank's extraordinary market operations during the financial crisis to purchase bonds and invest in troubled companies, and from earnings on loans to banks and securities firms.

The results represent a sharp rise from 2008, when the Fed earned 31.7 billion dollars and returned 35.5 billion dollars to the Treasury.

The profit included some 46.1 billion dollars in earnings on securities acquired through open market operations, including US Treasury bonds, mortgage-backed securities and government agency debt.
I was talking to a friend the other day, you may dismiss him because he has no economics degree, but that doesn't matter. Especially if you read obsessively through various sources on this topic. The Federal Reserve prints our money and he would say that right now the Fed is printing too much money and that devalues the currency. What caused the Great Depression 80 or so years ago was that the Fed wouldn't print more money. This according to a friend who is into Austrian Economics.

1 comment:

Rob Ross said...

A small factual correction - all profits earned by the Federal Reserve are remitted to the US Treasury.

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