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View Full Version : U.S. Issues he FED(private entity) makes RECORD PROFITS


BigChiefFan
01-13-2010, 01:38 PM
The Federal Reserve made $45 billion last year, according to an exclusive report in The Washington Post. That is the most the Fed has earned in 95 years.The central banks still owns securities that it may sell at a loss this year, but they could also gain back most of their value depending on the direction of the credit markets over the next several quarters.

The Fed has refused to detail its loan activities as the credit crisis deepened in 2008. These actions involved emergency loans to a number of large US banks. It is now obvious that the central bank made a small fortune on those loans and other activities to prop up the flagging financial system. It also made money on one of its standard functions to clear money through the bank system which garners the Fed fees.

The Administration recently raised the prospects of a large tax on banks to cover losses taxpayers may have taken on bank aid including the TARP. The Fedís numbers raise the issue of whether the government has already profited substantially from its bailout activity.

The White House has suggested in recent days that it may levy fees on large banks to help fund the national deficit. These fees may be based on bank liabilities on the theory that firms with bad balance sheets should cover future taxpayer risk with a contribution to the government. The alternative proposal is the most profitable banks pay high taxes because they can most readily afford them.

The tax on banks is rife with conflicts because financial firms may pass tax costs on to their customers which would take money from the pockets of both consumers and businesses. That would make the bank tax regressive as the recovery is based on a sharp increase in consumer and business spending.

The Fedís profit will be sent to the Treasury which will help lower the deficit. The profit proves that the Fed could potentially be a near-permanent contributor to government income. Traditionally, the central bank has been a policy body and has not been run as a source of funds. A change in that role could make a bank tax much less necessary.

Douglas A. McIntyre

BigChiefFan
01-13-2010, 01:39 PM
HE Fed, She Fed, Typo in the header.

petegz28
01-13-2010, 01:45 PM
I'll be expecting a speech from the Tele-Prompter saying this $45 bil will go to immediate deficit reduction or a tax refund to the taxpayer

Amnorix
01-13-2010, 02:20 PM
The Fed’s profit will be sent to the Treasury which will help lower the deficit.

BigChiefFan
01-13-2010, 02:22 PM
The Fedís profit will be sent to the Treasury which will help lower the deficit.The guys that dictate the interest rate, now get to make a profit? Gee, that isn't too convient to manipulate in their best interest.

Amnorix
01-13-2010, 02:35 PM
The guys that dictate the interest rate, now get to make a profit? Gee, that isn't too convient to manipulate in their best interest.

I don't think you have any idea what you're talking about. I assume you understand why they made a profit?

HonestChieffan
01-13-2010, 02:50 PM
I don't think you have any idea what you're talking about. I assume you understand why they made a profit?

Its impossible to explain. If the word Fed is mentioned and profit is mentioned it must be evil.

talastan
01-13-2010, 04:21 PM
I don't think you have any idea what you're talking about. I assume you understand why they made a profit?

Selling of debt? :shrug: I really don't know much to be honest. I do find it interesting that no one in Congress is going to accuse them of "windfall" profits though.