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100% of the feds profits go to the treasury every year. Are they "owned" by government? No, but they are beholden to the government at large in a roundabout way
by colinmhayes 4y ago
100% of the feds profits go to the treasury every year. Are they "owned" by government? No, but they are beholden to the government at large in a roundabout way in that congress could end the fed any time they wanted and the fed's chief is appointed by the president.
- eru 4y agoSo they are 'owned' by the government in any way that counts. The official legal Fed shareholders are more comparable to bondholders in other companies. Even the dividend on those shares is fixed, much more like a bond. When the Fed was first established, there were some rather peculiar political circumstances around, and those circumstances demanded a peculiar compromise in the way the Fed is structured. More than a century later, political circumstances have changed a lot, but the strange structure of the Fed stuck around as an artifact that was never annoying enough for anyone to bother cleaning up. It's the legal equivalent of old crufty code that nevertheless does its job and doesn't get in the way, so why touch it?