Tuesday, March 24, 2020

Nathan Tankus — What if The Federal Reserve Just ... Spent Money?


Nathan Tankus is a go-to guy on the institutional side of MMT. Following Scott Fullwiler, I also highly recommended subscribing to his new blog if you are into the nitty gritty and don't want to miss anything since I will only be linking it selectively. Nathan offers a free and a premium service. Like MMT legal scholar Rohan Grey, Nathan is an up-and-comer and is already becoming a star. The MMT bench is broadening and deepening. 

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Nathan Tankus
What if The Federal Reserve Just ... Spent Money?
... could it?

2 comments:

Matt Franko said...

The fed can only spend what their portfolio income is and if I recall correctly there sta in tutorily required to maintain the residual around 8 billion so if the residual gets much more than 8 billion they have to transfer the balances to the treasury account

Matt Franko said...

https://www.federalreserve.gov/newsevents/pressreleases/other20190322a.htm


"The Federal Reserve Banks' 2018 earnings were approximately $63.1 billion, representing a decrease of $17.6 billion from 2017. The Reserve Banks provided for remittances to the U.S. Treasury of $65.3 billion in 2018, including two lump-sum payments totaling approximately $3.2 billion that were necessary to reduce the aggregate Reserve Bank capital surplus to $6.8 billion as required by the Bipartisan Budget Act of 2018 and the Economic Growth, Regulatory Relief, and Consumer Protection Act. Interest income on securities acquired through open market operations totaled $112.3 billion, a decrease of $1.3 billion from the previous year. Interest expense on depository institutions' reserve balances during the year was $38.5 billion, an increase of $12.6 billion from the previous year. Interest expense on securities sold under agreements to repurchase was $4.6 billion, an increase of $1.2 billion from the previous year. Reserve Bank operating expenses were $7.0 billion"

Nathan's trip was paid for out of the $7.0B...