| > graph from multiple OPs literally say otherwise Not sure what this refers to. But whoever those OPs are, they're wrong. The Fed has remitted tens of billions of dollars to the Treasury every year since 2011 [1], including from realized (not mark to market) gains. > normally there's a multi-trillion dollar pool of buyers and the market is healthy You said the Fed "bought assets which literally nobody else wants." Present tense. Literally. > balance sheet is not some spot where the government makes investments for profits. Sure they had to cycle assets but they certainly didn't exit anything. They sold. You can tell because "transaction category," column C, says "sale" versus dollar rolling. > Why did the fed not do this pre-2009 If by "this" you mean QE, 2008 was the first true American credit crisis since WWII and the first depression-level threat since the Great Depression. > this was certainly not some brilliant profitable play Of course not. Making money isn't the Fed's job. It will lose money trimming its balance sheet because its policy goal, higher rates, directly reduce the value of those assets. (In the same way that its 2008 policy goals, lower rates and financial stability, directly increased the value of its purchases.) The Fed bought assets, in 2009 and '10, which people want to buy and have wanted to buy for a decade. They verifiably sold many of those assets. They're planning to sell much more in the near future. To buy these assets they had to issue liability in the form of money, which is literally their job. Every claim in the original comment [2] is materially incorrect and/or fundamentally misguided. [1] https://www.federalreserve.gov/newsevents/pressreleases/othe... [2] https://news.ycombinator.com/item?id=30778464 |