كيف تكبد الفدرالي الأميركي أكبر خسارة في تاريخه خلال 2023؟
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00:00 The US Federal Reserve recorded the largest operating losses in its history.
00:05 Usually, when we hear about operating losses, we get scared, especially if we are talking about a company, for example.
00:11 But for central banks, this may be normal.
00:15 It does not affect the work of the central bank, nor even its policy and strategy.
00:21 But we must highlight the reasons that led to these operating losses.
00:27 So, $114.3 billion is the total losses from 2023, despite the fact that it achieved profits in 2022.
00:37 We have seen for a long time a stability in terms of the levels of profits that were achieved.
00:46 But we have started to see these large operating losses deepen, especially after the US Federal Reserve began to raise interest rates in 2022.
01:00 Why? Today, when we talk about the Federal Reserve's budget, or specifically the Federal Reserve's income list, we talk about two main elements.
01:09 The first is the paid benefits and the received benefits.
01:12 The difference between them is that the one who generates the most profits is the one who generates the most losses.
01:17 Because the US Federal Reserve raised interest rates from 2022 to today, this led to it paying more benefits to banks for their insurance.
01:30 Therefore, the paid benefits have increased significantly.
01:33 While the received benefits for the Federal Reserve have increased, but not as much as the increase we have seen in the paid benefits.
01:43 As we have discussed, the main issue is the environment of interest rates, the increase in interest rates, and how this has affected the paid benefits and the received benefits for the Fed.
01:55 But there is another element that is included in this equation, which is the US Treasury.
02:00 Usually, when the Fed is making a profit, it cuts a part of this profit to cover its daily and operating expenses.
02:09 The other part is converted to the US Treasury, which uses these revenues and conversions to cover the deficit.
02:18 If we look at the past years, at the conversions that were received from the US Federal Reserve as the Treasury, we notice the spike we have seen after the financial crisis,
02:32 and the reason is that the Fed has reduced interest rates.
02:35 This allowed it to make bigger profits, and therefore, bigger conversions to the Treasury.
02:41 But we have seen these reductions later on, because the Fed has reduced the profits it makes, and then converted them to losses.
02:53 But the question today is, what happens when the Fed does not make profits?
02:57 If it makes profits, it converts a large part of it to the Treasury.
03:01 But what happens when there are losses?
03:03 The Fed opens a section in the Treasury called the Deferred Assets, and it calculates these assets, which are considered a special account of the Treasury,
03:18 and it makes a collection of them, which is related to the amount of money that should be converted to the US Treasury in the future.
03:27 Until the end of last year, the Fed announced that it has a deferred assets for the Treasury, which is 133.3 billion dollars, which is a record level.
03:38 Now, in the coming years, or in any year, the Fed will start to make profits, and will start to reduce these deferred assets until it returns to zero.
03:49 When will the US Fed return to make operating profits?
03:54 This is, of course, related to the environment of interest.
03:57 But according to a federalist research in St. Louis, he said that the Fed needs four years before it starts to make profits again,
04:07 and starts to make conversions again to the Treasury, which is expected to be in the middle of 2027.
04:13 But as we said, these losses will not affect the federalist policy or even its actions, and we have seen similar losses for all, for example, the European Central Bank.