The Fed did not “spend” $1.5 trillion; it loaned the money to banks, which rely on these kinds of short-term loans as a way to get cash when most of their resources are tied up in assets like bonds. What’s more, the Fed’s loans are collateralized, meaning they are backed up by bonds worth even more than the money the Fed lent. If the banks should for some reason default on the loan, the Fed gets to keep the bonds and makes a sizable profit. If the loans are paid back, the Fed still makes a profit because it charges a modest amount of interest for the loan.
The Fed’s $1.5 trillion loan injection, explained.
I wish I could get trillion dollar loans at 1.5% interest and then turn around and loan it out at 6-30% to tax slaves. If things go sideways I'll just get another trillion dollar loan to service the debt with and jack up the consumer rate later.
I would also shift the profits to another business, like my credit card business, just in case the government demands loan repayment.
Shaloms
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