Is the Federal Reserve really over 1 trillion in the hole?

Degaston ^

[rb22982]

“Do you believe that the Federal Reserve is Solvent if their Assets are all valued at Fair Market Value?”

You say a lot that is irrelevant and it’s obvious you don’t know what you are talking about. The Fed res creates US dollars. It is not a bank. It cannot be insolvent unless it chooses to do so. There is zero alternative to the US dollar. Despite a 50% increase in m2 directly caused by the Fed, the dollar is up massive against nearly everything on the planet. They did print $4 trillion in 2020 and a similar amount from 2008-2012. Have a good night and continue to call for the end of the USD when it’s had it’s best year in decades

[Degaston]

You didn’t answer the question. I do know what I’m talking about - i.e. the actual data. I’m not responding to you anymore. Bye.

[rb22982]

I gave plenty of data. The only data you gave is their balance sheet shows the value is 3% below book, which 1) is again entirely due to their own decision to raise rates - they knew it would lower the value of their bonds - they can lower rates anytime they want and 2) they can print money anytime they want and 3) not a very large % of their assets

There is ZERO risk of insolvency for the central bank - if that were to theoretically happen it would end up as inflation due to #1 and #2 below, not as a crash. IF there was even a single thing globally that could replace the dollar there would be a smidge of a risk, but the Euro is 10x worse shape than the dollar and the Chinese Remnibi is 50x riskier now. Nothing else could be.

[Degaston]

P.S. For anyone interested - here is the data I reported in the link at the top of this thread. It’s my own work/analysis.

Reported Amount Fair Amount Loss % Loss Amount
Over 10 years - Mortgage-backed securities 2,616,239 2,272,354 13.14% 343,885
Over 1 Year to 5 Years - U.S. Treasury securities 1,956,645 1,793,068 8.36% 163,577
Over 10 years - U.S. Treasury securities 1,462,446 1,014,953 30.60% 447,493
Over 5 Years to 10 Years - U.S. Treasury securities 957,046 823,467 13.96% 133,579
Within 15 Days - U.S. Treasury securities 83,416 83,416 1,088,533 Total Losses
16 Days to 90 Days - U.S. Treasury securities 321,595 321,595
91 Days to 1 Year - U.S. Treasury securities 754,177 754,177
Over 5 Years to 10 Years - Mortgage-backed securities 51,831 51,831
All Other Securities Held Outright 6,358 6,358
Unamortized Premiums on Securities Held Outright 317,952 317,952
All other Assets 93,685 93,685
Total Assets 8,621,390 7,532,857
Total Liabilities 8,579,805 8,579,805
Total Net Worth (Total Capital) 41,585 (1,046,948)
52 week high Current market Loss % Link
iShares 20+ Year Treasury Bond ETF (TLT) 155.12 102.9 33.66% https://finance.yahoo.com/quote/TLT
iShares 10-20 Year Treasury Bond ETF (TLH) 152.65 110.62 27.53% https://finance.yahoo.com/quote/TLH
iShares 7-10 Year Treasury Bond ETF (IEF) 116.64 97.11 16.74% https://finance.yahoo.com/quote/IEF
iShares 3-7 Year Treasury Bond ETF (IEI) 129.8 115.3 11.17% https://finance.yahoo.com/quote/IEI
iShares 1-3 Year Treasury Bond ETF (SHY) 85.96 81.19 5.55% https://finance.yahoo.com/quote/SHY
iShares MBS ETF (MBB) 107.88 93.7 13.14% https://finance.yahoo.com/quote/MBB
FRED St Louis Federal Reserve Table 1 https://fred.stlouisfed.org/release/tables?rid=20&eid=1193943
FRED St Louis Federal Reserve Table 2 https://fred.stlouisfed.org/release/tables?rid=20&eid=840849
Federal Reserve Balance Sheet Release https://www.federalreserve.gov/releases/h41/current/h41.htm#h41tab1

[Degaston]

P.P.S. When I call the Federal Reserve “Insolvent” I mean that they are technically insolvent.

https://moneyterms.co.uk/technical-insolvency

“If a company (or person) is technically insolvent that merely means that it has a negative net asset value; its liabilities are greater than its assets.”

Of course, anyone can try to mince around with words like Bill Clinton did in his deposition with Paula Jones’s legal team in 1998 and later that year with Ken Starr’s legal team and try to tap dance around the actual issues at hand. Of this tactic I am very tired of dealing with. I’d really prefer to have a healthy dialogue about the actual facts with those seeking to be honest.

The data I provided showed the Federal Reserve being $1,046,948,000,000.00 in the hole as the amount that their Liabilities exceeds their Assets.

If someone has some calculations that they believe are more accurate on this question of “is the Federal Reserve technically insolvent” then I am interested in seeing those calculations and their rationale. Now, what I will not do is respond to those who claim to provide data (but don’t actually address these numbers) and misrepresent the data that I have provided.