The transparency the Fed needs to pay the bank pays $186 billion while operating at loss

Federal Reserve System (“Fed”) is a huge institution with the ability to manipulate and control the entire American economy. Our work, our finances, our savings, and ultimately our livelihoods — all of which are subject to decisions made by the Fed.

However, the Fed’s deliberations and operations will take place in a closed room.

It’s time to see how the Fed will make decisions. Congress must take immediate steps to provide transparency to Americans.

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Other institutions have no unchecked powers. There is no need to look for the unlimited permissions the Fed used in response to the Covid-19 pandemic. Fed purchased printed money, government-supported securities and drank a ton of money into the favorable industry. These actions added nearly $5 trillion in debt to the Fed’s balance sheet.

To be clear, Fed representatives are only interested in transparency to the extent that they provide political coverage. For them, the Fed’s opacity is a feature, not a bug, and their leadership considers secrets to be a great asset.

If you ask them, accountability to the Americans and taxpayers who support their financial homes is actually bad. From the Fed’s perspective, it is in some way harmful or dangerous to even question this arrangement.

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Our country is currently over $37 trillion. Adequate people in Washington are willing to say “no” because they don’t want to stop spending other people’s money. “Other people” are future generations of Americans who are vulnerable to current voices when they are seeking money for today’s tomorrow.

The Fed owns a share of responsibility for this as its plot and operation helps perpetuate this unsustainable situation, but it has become increasingly difficult every year.

No one pays attention to the hundreds of millions of dollars the Fed has unnecessarily paid to banks in order not to lend money to consumers.

For almost a century, the Fed did not pay interest to banks to retain the Federal Reserve in the deposit boxes of these banks, but everything that changed in the wake of the 2008 financial crisis has changed.

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Paying interest to banks to hold Fed funds was originally intended to manage inflation. Also, from 2008 to 2016, the interest rate on reserves was only 0.25%, with an average annual payment of $5 billion.

However, things quickly changed dramatically. Interest rates today exceed 4%, and since then, subsidies to Fed banks have skyrocketed. To be clear, what this means is that the Fed has paid hundreds of billions of dollars to banks to not lend money to consumers.

If you ask them, accountability to the Americans and taxpayers who support their financial homes is actually bad. From the Fed’s perspective, it is in some way harmful or dangerous to even question this arrangement.

In 2022, the Fed paid nearly $60 billion to the bank. In 2023, Fed payments to banks increased by more than $176 billion, and in 2024, Fed subsidies to banks increased to around $186 billion. 44% of these subsidies are paid to foreign banks.

It’s getting worse. The Fed is not profitable and has not made profits for several years. In fact, I insisted it. Consumer Financial Protection Bureau, The Leviathan agency, which receives infamous funds from the Fed, should be closed as the Fed has been operating losses since 2022.

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One of the main reasons the Fed continues to lose is due to its economically illiterate commitment to paying these interests.

The Fed has the authority to restore reserve balance requirements and ensure that banks are not entitled to payment of these interests. In the meantime, the Fed has chosen to select its policy to make its losses worse than necessary.

The Fed is no longer making a profit and has stopped paying back the profits to taxpayers by sending these funds to the Treasury Department, but it still pays hundreds of millions of dollars to the bank. Meanwhile, the country’s largest banks receive the majority of Fed payments.

But it’s hard to say who and how much, as all of that is hidden by the Fed and it could be just the tip of the iceberg.

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Taxpayers need to know why the Fed can’t afford policies that benefit them, but they can afford hundreds of millions of dollars on bank payments.

The good news is that I am leading the charges against Fed mismanagement and secrets, and our ranks are increasing.

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On July 21st, I said, “We have ended the Fed’s Big Bank Relief Act. Federal Reserve SystemSubsidies to large and small banks by prohibiting payment of interest on reserve balances. Vermont Independence Senator Bernie SandersSupport for the law demonstrates the broad appeal of ending the bank’s easy profits at the expense of taxpayers.

He then proposed legislation to audit the Fed.Federal Reserve System Transparency Act. ” More and more government figures are moving to hold the Fed accountable, creating a momentum of transparency.

Currently, the dam is broken in response to reports of a cost-overrun of hundreds of millions of dollars due to a $2.5 billion renovation of the Federal Reserve Office.

In 2022, the Fed paid nearly $60 billion to the bank. In 2023, Fed payments to banks increased by more than $176 billion, and in 2024, Fed subsidies to banks increased to around $186 billion. 44% of these subsidies are paid to foreign banks.

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US Treasury Secretary Scott Betting On July 21, he said, “We have shown that we need to look into the entire Federal Reserve system and see if they have succeeded (.) Did the organization succeed in that mission?

Without accountability and transparency, the Fed manipulated the economy and wasted resources. The reality cannot be denied. Urgency is real. The moment is now. It’s time to audit the Fed.

Republican Rand Paul represents Kentucky in the US Senate. He is the author of the book.”Litigation against socialism“(Broadside Book, October 2019).