"The Fed’s $77.6 Billion Hit: Why the Central Bank Can’t Catch a Break — And the $1 Trillion Problem Ahead"

The Fed just posted a $77.6 billion loss for 2024 — that’s two years in a row of bleeding money (though it’s better than the $114.6 billion hit from 2023). The problem boils down to rising interest costs outpacing the money it makes from Treasuries and mortgage-backed securities — a side effect of those aggressive rate hikes to fight inflation.

On top of that, the Fed’s sitting on $1.06 trillion in unrealized losses (up from $948 billion in 2023) because its long-term bonds lost value as yields went up. Long story short: the Fed’s stuck between fighting inflation and dealing with a growing financial mess.

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