Mulling Over the Fed's 34 Basis Points

David Merkel submits:

Who cares what the Federal Reserve remits to the U.S. Treasury? Some are amazed by the record $78.4 billion remitted to the Treasury, as if that were “found money.” It is all stolen out of the pockets of savers, who deserve a currency that is truly a store of value, and rewards saving.

The amazing thing to me is that the Fed only earns 34 basis points on assets, especially since it pays less than 25 basis points on assets as a cost of funds over the last year. The huge earnings points me to the massive leverage the Fed uses, 44x, which it would/should not let the banks that it regulates operate at.

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