An investigative report by Pam and Russ Martens reveals that the U.S. Federal Reserve has incurred $176 billion in operating losses since September 28, 2022, as of June 19, 2024.

These losses are attributed to the Fed paying out higher interest rates of 5.4% on reserve balances, benefiting major banks like JPMorgan Chase and Bank of America, while earning less on its debt securities.

The report also highlights unrealised losses on the Fed’s balance sheet securities, adding to the financial strain.

This situation poses challenges to the Fed’s monetary policy and exposes deeper systemic issues within its operations.

The continuous losses raise concerns about the sustainability of the current financial strategy, and need for a reassessment of the Federal Reserve’s fiscal management.