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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: energyplay who wrote (47789)	3/24/2009 8:14:08 PM
From: KyrosL	Read Replies (1) \| Respond to of 220282

The member banks get 6% on their Fed "stock", which is relative peanuts. All the rest of the Fed profits go to the Treasury. During periods, such as now, when the Fed prints money (eases quantitatively), interest on Fed holdings is a relatively small part of the Fed's profits. The lion's share are derived from the money printing. For example, if ultimately, the Fed creates AND keeps in circulation $1 trillion of new money, that's how much the Treasury will get eventually. The Treasury will not actually "get" this money, but the Treasury notes and bonds the Fed bought with that money will be essentially cancelled out when they mature -- instead of being redeemed.