Profits and Losses Don’t Matter at the Federal Reserve

null By Jason FurmanSept. 27, 2023 6:28 pm ETWonder Land: Most federal employees already work from home. Let's make that permanent. Images: AP/iStock Photo Composite: Mark KellyWhen the Federal Reserve was amassing a cumulative profit of more than $1 trillion for the taxpayer from 2008-22, public gratitude was scant. Now that the central bank is losing about $100 billion a year, with similar losses on the horizon, critics say this will exacerbate banking turmoil, compromise monetary policy, or even threaten the Fed with bankruptcy. It won’t do any of those things. The Federal Reserve’s primary mandate is ensuring maximum employment and price stability, not turning a profit. Financial losses don’t impede that mission.Copyright ©2023 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8Continue reading your article witha WSJ subscriptionSubscribe NowAlready a subscriber? Sign InSponsored OffersTurboTax: Save up to $15 with TurboTax coupon 2023The Motley Fool:

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Opinion Sep 28, 2023 Add to Reading List

Profits and Losses Don’t Matter at the Federal Reserve

null

Jason Furman

Sept. 27, 2023 6:28 pm ET

Wonder Land: Most federal employees already work from home. Let's make that permanent. Images: AP/iStock Photo Composite: Mark Kelly

When the Federal Reserve was amassing a cumulative profit of more than $1 trillion for the taxpayer from 2008-22, public gratitude was scant. Now that the central bank is losing about $100 billion a year, with similar losses on the horizon, critics say this will exacerbate banking turmoil, compromise monetary policy, or even threaten the Fed with bankruptcy. It won’t do any of those things. The Federal Reserve’s primary mandate is ensuring maximum employment and price stability, not turning a profit. Financial losses don’t impede that mission.