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santafe2

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santafe2

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Saturday, 09/02/2023 10:37:24 PM

Saturday, September 02, 2023 10:37:24 PM

Post# of 110742
Regional banks are not the only entities losing money by holding longer term, low interest rate securities. Turns out the Fed has the same problem. This month they should hit $100B in losses.

The Fed’s 12 regional banks, which used to make a lot of money, are now running big collective deficits. That’s because they’re paying more than 5% on trillions of dollars that they’ve borrowed from money-market funds and other financial institutions, while their own portfolios remain loaded with low-yielding mortgage and Treasury securities that they bought during the days of near-zero interest.

https://www.barrons.com/articles/fed-money-market-funds-6e81cfe0?mod=hp_LEAD_1

Rule #1, Don't lose money. Rule #2, read rule #1. - WB.

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