The FTX balance sheet is less worrisome to me than this balance sheet.
https://www.federalreserve.gov/releases/h41/current/
(1) Look for “8,255,992” on the “Securities held outright” line.
(2) Now search for “8,678,886”, “8,637,300”, and “41,586” to get the summary total Assets, Liabilities, and Capital amounts.
(3) Now consider how the “Securities held outright” line has taken at least a 10% cut this year & likely closer to 20%. This means that the “Total Capital” number should be “minus 784 billion” or even as low as “minus 1.6 trillion” if the present fair market value of the “Securities held outright”, “Unamortized premiums on securities held outright”, and “Unamortized discounts on securities held outright” lines were calculated accurately.
The Federal Reserve must be very insolvent right now.
https://www.dictionary.com/browse/insolvent
not solvent; unable to satisfy creditors or discharge liabilities, either because liabilities exceed assets or because of inability to pay debts as they mature.
not solvent; unable to satisfy creditors or discharge liabilities,
What does the Fed owe? Who do they owe it to?
How have prices of these types of securities changed?
Long-term Treasuries down over 30%
https://finance.yahoo.com/quote/TLT/
7-10 year Treasuries down approx 20%
https://finance.yahoo.com/quote/IEF
3-7 year Treasuries down approx 12%
https://finance.yahoo.com/quote/IEI
1-3 year Treasuries down approx 5%
https://finance.yahoo.com/quote/SHY
Mortgage-Backed Securities down approx 14%
https://finance.yahoo.com/quote/MBB
https://finance.yahoo.com/quote/VMBS
https://etfdb.com/etfdb-category/mortgage-backed-securities/