re: The Federal Reserve is running huge losses. Who pays for it?

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Bayoutigre

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the federal reserve has NEVER been audited,nor does it pay tax.they can tell you whatever numbers they want,all internal.the USA,INC. could have walked away a few years back.but NOBODY in congress had the balls to even bring it up.the feds are done,over we have no debt,they are no longer allowed to print money.

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the federal reserve has NEVER been audited

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KPMG does a full audit on their balance sheet (which encompasses the entire operation) every year.

Yep, you can count on the Fed to adjust policies to forward their mandate whenever they wish.

The Fed chairs and US Treasury secretaries are generally of a particular demographic as well!!

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Getting back to your fake news OP, ......

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There has just been a landmark event at the Federal Reserve: Its accumulated operating losses have passed $100 billion. This startling number, which would previously been thought impossible, was reported on Sept. 14, 2023, in the Fed’s H.4.1 Release.

It is essential to understand that these are not mark-to-market paper losses; they are real cash losses resulting from the Fed’s expenses being to this remarkable extent greater than all its revenue. These are equally losses to the U.S. Treasury and thus costs to the taxpayers; nonetheless the Fed keeps officially insisting that its losses don’t matter. (Meanwhile the Fed’s mark-to-market losses are more than $ 1 trillion in the most recent public report.)

The Fed started posting operating losses in September 2022, so it has taken only 12 months to produce this ocean of red ink. Looking forward, annualizing the year-to-date results suggests the Fed’s net loss for calendar year 2023 will be about $117 billion.

...... the Fed itself, the Treasury and the taxpayers will be suffering continuing huge losses.

Fed is in TROUBLE!!

TROUBLE!!

Maybe you should arrive on the double!!

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tinfoil illiterates.

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So please explain to us, oh wise, rational and literate one, the exact mechanics of Quantitative Easing and please also explain the exact mechanics of it’s opposing policy counterpart, Quantitate Tightening.

Then please give us a detailed history of specifically when and where these mechanisms have been applied and further their success rate.

It all is so esoteric and complex for us thick-browed, drooling cretins to comprehend.

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She mentions operating losses then links to the Fed's balance sheet to prove it. The Fed's longer term bond holdings have lost market value as interest rates have risen.

That's NOT operating losses.

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I respect your knowledge, Russian, and you're a solid poster. She does discuss the difference between capital losses and operating losses. She also discusses the unique accounting that the Fed uses that doesn't follow FASB.

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The Fed’s capital losses are derived from its large bond portfolio of low-coupon US Treasury and mortgage-backed securities purchased in earlier times of low rates during the period of quantitative easing following the 2008–09 financial crisis. As the Fed has now raised interest rates in its efforts to reduce inflation, the market value of its bond portfolio has inevitably declined. Estimates of these capital losses range as high as $100 billion. The bond portfolio resides in the System Open Market Account, which is managed by the Federal Reserve Bank of New York on behalf of the entire Fed system.

The Fed’s operating losses, on the other hand, result when its expenses run higher than its revenues. The Fed’s revenues consist mostly of interest income on its large bond portfolio. The Fed’s expenses include payment of interest on commercial banks’ reserves on deposit at Fed district banks and reverse repurchase (repo) transactions with money market funds, as well as Fed overhead expenses such as the operations of the Consumer Financial Protection Bureau, which is funded by the Fed rather than as an independent agency funded by Congress. The US Supreme Court is currently considering the constitutionality of this funding arrangement between the Fed and the Consumer Financial Protection Bureau.

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The Fed’s operating and capital losses are genuine in both an accounting and an economic sense. Though the Federal Reserve has designed its own accounting rules rather than subscribing to those of the Financial Accounting Standards Board, the Fed’s own financial reports clearly show ongoing accounting losses by any metric.

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I take it you don't subscribe to the Austrian school, which is fine, but I don't think the author is as boneheaded as you say.

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Question: when Congress established the Federal Reserve system did the Act require the Fed to be profitable? Yes or no.

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Don't you constantly insist that the Fed Reserve is a private institution?

Look, there is no doubt you're way more educated on finance and economics than a guy like me, who just owns a small pest control company, but some of this shite makes absolutely no sense at all.

What private company has its chairman chosen by government? What private company doesn't have to earn profits in order to stick around for 100 years? What private company had an act of congress to create it?

I get that. I just can't seem to grasp how the Fed Reserve is a private bank.

It just has to be what I consider a private company and what others consider a private company are completely different things.

Russian is smart AF on these issues, and I'm just trying to get clarification on his reasoning for calling it a private bank.