{"id":622768,"date":"2023-03-28T09:49:00","date_gmt":"2023-03-28T14:49:00","guid":{"rendered":"https:\/\/news.sellorbuyhomefast.com\/index.php\/2023\/03\/28\/for-the-first-time-the-fed-is-losing-money\/"},"modified":"2023-03-28T09:49:00","modified_gmt":"2023-03-28T14:49:00","slug":"for-the-first-time-the-fed-is-losing-money","status":"publish","type":"post","link":"https:\/\/newsycanuse.com\/index.php\/2023\/03\/28\/for-the-first-time-the-fed-is-losing-money\/","title":{"rendered":"For the First Time, the Fed Is Losing Money"},"content":{"rendered":"<div xmlns:xlink=\"http:\/\/www.w3.org\/1999\/xlink\">\n<div>\n<h2>Thanks to interest-rate risk exposure, the central bank will soon have negative equity capital.<\/h2>\n<\/div>\n<div>\n<div>\n<p>By <span><span>Paul H. Kupiec<\/span><\/span> and <span><span>Alex J. Pollock<\/span><\/span><\/p>\n<p><time datetime=\"2023-03-26T18:52:00Z\">March 26, 2023 2:52 pm ET<\/time><\/p>\n<\/div>\n<section>\n<p data-type=\"paragraph\">Like all central banks, the Federal Reserve was designed to make money for the government from its monopoly on issuing currency. The Fed did generate profits, which it sent to the Treasury, every year from 1916 on\u2014until last fall. In a development previously unheard of, the Federal Reserve has suffered operating losses of about $42 billion since September 2022.<\/p>\n<p data-type=\"paragraph\">That month, the massive interest-rate risk created by the Fed\u2019s asset-liability maturity mismatch began generating cash-operating losses, and the losses now average $7 billion a month. This is because the Fed\u2019s trillions of dollars of long-term investments yield 2% but cost 4.6% to finance. The Fed will soon have negative equity capital, and as operating losses continue to mount, its equity-capital deficit will grow.<\/p>\n<\/section>\n<\/div>\n<\/div>\n<p><a href=\"https:\/\/www.wsj.com\/articles\/for-the-first-time-the-fed-is-losing-money-mortage-backed-securities-treasurys-interest-rate-risk-svb-ad92e96f\" class=\"button purchase\" rel=\"nofollow noopener\" target=\"_blank\">Read More<\/a><br \/>\n Raleigh Mayoral<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Thanks to interest-rate risk exposure, the central bank will soon have negative equity capital.By Paul H. Kupiec and Alex J. PollockMarch 26, 2023 2:52 pm ETLike all central banks, the Federal Reserve was designed to make money for the government from its monopoly on issuing currency. The Fed did generate profits, which it sent to<\/p>\n","protected":false},"author":1,"featured_media":622769,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[673,3002,46],"tags":[],"class_list":["post-622768","post","type-post","status-publish","format-standard","has-post-thumbnail","category-first","category-losing","category-technology"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts\/622768","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/comments?post=622768"}],"version-history":[{"count":0,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts\/622768\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/media\/622769"}],"wp:attachment":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/media?parent=622768"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/categories?post=622768"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/tags?post=622768"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}