The Federal Reserve garnered
The Federal Reserve took in a record 52.1 billion in windfall for 2009 despite the dire financial circumstances. Breaking more ground, $46.1 billion, of that will go to the Treasury Department. The sum, announced Tuesday marks the largest Treasury payout since in the Fed’s history with the second being $34.6 billion in 2007 pre-crash.
The Federal Reserve gives all the profit after expenses over to the Treasury Department.
The Federal Reserve Banks method of ending the financial crisis is divergent from the $700 billion bailout program that began in 2008. The Fed launched a number of programs to encourage sales of securities meant to aid the economy. The eventual goal of the Fed’s plan is to push down mortgages and consumer debt.
The Fed has been keeping the interest rate at an incredibly low rate to bolster the purchase of securities among other plans. The last year has been a productive one for the Central Bank, which acquired $300 billion worth of government debt and is working to purchase $1.25 trillion in mortgage securities from Fannie Mae and Freddie Mac in order to augment the worth of their securities.
The possibility of the Fed having to sell some of these securities in order to avoid inflationary consequences that are the result of the money being inundated into the economy during the crisis remains daunting.
About EQUITIES:
Since 1951, EQUITIES Magazine has been a leading media company providing business editorial content designed to serve the needs of business leaders, professionals, institutional investors and retail investors. We are focused on business and the business of making money, not on lifestyle subjects. We publish original reporting in print and on our website, as well as select content at www.nasdaq.com. For 28 years we have hosted our own branded investor conferences that connect public company CEO’s with our loyal readers in the investment community.
Sign up for a free one-year subscription
