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  • Writer's pictureJacob Rozenberg

Federal Reserve policy

What most US citizens don't understand, is that the taxpayer has been placed on the hook to guarantee most of the Federal Reserve's balance sheet. The manner in which the Federal Reserve system is set up legally is insanely complicated, by nature. The short take is that each individual member bank of the Federal reserve system (around 5,000 banks) are financially on the hook for just 1.8% of the $6.97 trillion Fed balance sheet. This has to do with the share ownership structure of the Federal Reserve. The remaining 98% is backed by the taxpayer. - Jacob

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