<p>Fed sends its net profits to the US treasury. Fed keeps portion of the money it earns to cover its operating expenses but everything above that is necessary for it's functioning and dividends to member banks is remitted back to the treasury see the explainer by Fed St Louis <a href="https://www.stlouisfed.org/on-the-economy/2018/september/fed-payments-treasury-rising-interest-rates" rel="nofollow noreferrer">here</a>. </p>

<p>For example, according to <a href="https://bankingjournal.aba.com/2020/01/fed-pays-54-9-billion-to-treasury/#:~:text=The%20Federal%20Reserve%20System%20paid%20%2454.9%20billion%20out%20of%20its,and%20%2465.3%20billion%20in%202018." rel="nofollow noreferrer">ABA Banking journal</a> the Fed net revenue in 2018 was <span class="math-container">$\$55.5$</span> billion, from which <span class="math-container">$\$54.9$</span> billion was payed directly to the US treasury.  The dividend payments according the source totaled <span class="math-container">$\$714$</span> million, rest was all used to cover various operating costs.</p>

CC BY-SA 4.0
2020-06-16T16:56:24.223Z
2020-06-16T17:02:46.463Z
2020-06-16T17:02:46.463Z
1muflon1
<p>As far as I understand the system the Fed prints money which it then uses to buy bonds. Bonds are basically statements of debt meaning that the Fed receives interest from the parties it has bought the Bonds from, because of the nature of debt overall if the debt is repaid the Fed has not only recouped the money they have printed that also have made a profit. What do they do with that profit? To they buy more bonds? Give it to the treasury? Where does the printed money end up?</p>

<money-supply><government-debt><federal-reserve><debt><bonds>
What does the Fed do with their profits?
Philogy
# What does the Fed do with their profits?

(Asked by: username_0 on 2020-06-16)

As far as I understand the system the Fed prints money which it then uses to buy bonds. Bonds are basically statements of debt meaning that the Fed receives interest from the parties it has bought the Bonds from, because of the nature of debt overall if the debt is repaid the Fed has not only recouped the money they have printed that also have made a profit. What do they do with that profit? To they buy more bonds? Give it to the treasury? Where does the printed money end up?

**Tags:** money-supply, government-debt, federal-reserve, debt, bonds

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## 1 answers

### Answer by username_1 on 2020-06-16. Score: 2 | Accepted answer

Fed sends its net profits to the US treasury. Fed keeps portion of the money it earns to cover its operating expenses but everything above that is necessary for it's functioning and dividends to member banks is remitted back to the treasury see the explainer by Fed St Louis [here](https://www.stlouisfed.org/on-the-economy/2018/september/fed-payments-treasury-rising-interest-rates).

For example, according to [ABA Banking journal](https://bankingjournal.aba.com/2020/01/fed-pays-54-9-billion-to-treasury/#:~:text=The%20Federal%20Reserve%20System%20paid%20%2454.9%20billion%20out%20of%20its,and%20%2465.3%20billion%20in%202018.) the Fed net revenue in 2018 was $\$55.5$ billion, from which $\$54.9$ billion was payed directly to the US treasury. The dividend payments according the source totaled $\$714$ million, rest was all used to cover various operating costs.


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