Federal Reserve makes record $50 billion in profits

The Federal Reserve has posted record profits in 2009 by making $50.2 billion, which is a $14.4 billion increase from 2008.

On Tuesday, the United States Federal Reserve stated that it posted a $50.2 billion profit in 2009, which is a record for the central bank since its inception in 1913, according to Reuters, and paid $46.1 billion to the Treasury. The Fed generally funds itself and gives profits back to the Treasury Department. The 2009 profits is a $14.4 billion increase from the 2008 results. More than $5.5 billion came from consolidated limited liability companies, which were created in response to the economic turmoil. The Fed also gained $2.9 billion in earnings from loans extended to depository institutions. Currency swap agreements and investment denominated foreign currencies netted the Fed $2.6 billion. In a statement issued by the central bank, according to Xinhua, they said, “The significant increase in earnings on securities was primarily due to increased securities holdings as a result of the Federal Reserve's response to the severe economic downturn.” The BBC notes that the US taxpayers gained money from the government’s intervention in the current financial crisis.