We Study Billionaires - The Investor’s Podcast Network TIP533: How the Fed went Broke w/ Lyn Alden
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Mar 12, 2023 
Lyn Alden, an investment expert known for her sharp insights into macroeconomic trends, dives deep into the financial woes of the Federal Reserve. She discusses how the Fed's balance sheet shapes economic stability and the implications of rising interest rates. Alden also expresses her optimism about investing in India and Brazil. Additionally, she explores the future of digital currencies and stresses the importance of a diversified investment portfolio for peace of mind and happiness. Her unique perspectives on financial literacy shed light on preserving purchasing power.
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Fed's Balance Sheet
- The Fed's balance sheet resembles a commercial bank's, with assets and liabilities.
- A key difference is the Fed can operate with negative equity, using IOUs against future income.
Fed's Lost Revenue
- From 2011 to 2022, the Fed remitted $1 trillion to the Treasury.
- This revenue stream, now gone, highlights the importance of Fed profitability for independence.
Central Bank Independence
- Electing central bankers might give governments excessive control over monetary policy.
- Central bank independence, although imperfect, offers checks and balances.