![]() ![]() Read the rest of the article via The Washington Post. Further details about the production costs for Federal Reserve notes are presented in the 2022 Currency Budget (PDF). FRBNs, as they are referred to in the hobby, were actually payable by the individual Federal Reserve banks, whereas FRNs were payable by the United States. The table below provides details on the printing costs of Federal Reserve notes for each denomination. Federal Reserve Bank Notes differ from Federal Reserve Notes in the language of which entity will be paying to the bearer on demand. Little wonder First Republic, another massive bank, failed this week. The 2022 currency operating budget is 1,060.0 million. ![]() ![]() Regulation of individual banks clocks in third, below the Fed’s role in protecting financial stability, and above its role in operating and regulating payment systems. The SVB report lists the Fed’s five key functions: Monetary policy is listed first. The deeper problem, though, is that regulation is just not the Fed’s top priority. But the Fed stopped including interest rate increases in their stress tests of banks similar to SVB in 2015 and didn’t require the bank to hedge. One would think the Fed would have been most attuned to the possibility of interest rates rising, as they set rates. But it would have protected the bank when interest rates rose. Hedging costs money and that would have reduced the bank’s profits and its management bonus pool. As part of this function, the Fed also promotes maximum employment and ensures interest rates remain moderate over time. A strong regulator would have required SVB to hedge those risks. The Federal Reserve has four main functions: Manage inflation: This is the Feds most visible function. SVB took massive bets that interest rates would remain low. It makes more sense to take bank regulation away from the Fed and give it to an agency that will make it their telos.Įvidence of this problem is clear in the Fed’s April report on its failing as a bank regulator in the collapse of Silicon Valley Bank. ![]()
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