The Washington Post calculated that the Federal Reserve will return about $45 billion to the Treasury Department after earning a record profit because of its unconventional initiatives to boost the economy. "This shows that central banking is a great business to be in, especially in a crisis," said Vincent Reinhart, a former official at the Fed and a resident scholar at the American Enterprise Institute. "You buy assets that have a nice yield, and your cost of funds is very low. The difference is profit."
Tuesday, January 12, 2010
Fed makes record profit, will return $45 billion to Treasury
The Washington Post calculated that the Federal Reserve will return about $45 billion to the Treasury Department after earning a record profit because of its unconventional initiatives to boost the economy. "This shows that central banking is a great business to be in, especially in a crisis," said Vincent Reinhart, a former official at the Fed and a resident scholar at the American Enterprise Institute. "You buy assets that have a nice yield, and your cost of funds is very low. The difference is profit."
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