Unfortunately not 100% true, especially after the CARES act. Under the CARES Act, there is a huge chunk of money that the Treasury is obligated to back into Fe

Unfortunately not 100% true, especially after the CARES act. Under the CARES Act, there is a huge chunk of money that the Treasury is obligated to back into Fed assets. Specifically "investments in programs or facilities established by" the Fed. So on one hand, the Treasury is obligated to invest (buy) assets from the Fed. The Fed has some leeway in what it sets up, but the bill also states that the Treasury can attach “such terms and conditions . . . as the Secretary determines appropriate.” So, in essence, the Secretary of the Treasury gets final say in what the Fed sets up. Therefore, what is actually going on is the Treasury can say "Fed, go buy up assets X" and then hands them the money from the CARES Act to do so. Or, in other words, now the Fed is acting as a banking institution for the Treasury. https://www.brookings.edu/research/explaining-the-new-fed-treasury-emergency-fund/ https://www.brookings.edu/research/explaining-the-new-fed-tr...