The Federal Reserve’s expenses exceeded its earnings in 2023 by $114.3 billion, its largest operating loss ever, forcing the US central bank to forgo remittances to the Treasury as interest rates remain elevated.
    • Che's Motorcycle@lemmygrad.ml
      4·
      8 months ago

      I think this is the key bit:

      After covering its day-to-day operating expenses, the central bank is required to send the money it earns on its securities portfolio to the Treasury, where the revenue helps offset federal deficits.

    • ☆ Yσɠƚԋσʂ ☆@lemmy.mlOP
      21·
      8 months ago

      Basically, debt payments end up reducing overall operating budget. So, the bigger the payments the less money there’s left for doing anything.