Slick accounting at the Federal Reserve could prove disastrous
This was James Bullard, president of the Federal Reserve Bank of St. Louis, speaking at the September 2012 meeting of the Federal Open Market Committee, according to the minutes. Said a staff member in reply, “It has never been the case that we have had, for the Federal Reserve System as a whole, a deferred asset.” But they knew that they might have one going forward. Earlier in the meeting, the staff had reported that all the options considered to reduce the Fed’s bond portfolio would cause the “creation of a deferred asset,” perhaps even a “substantial deferred asset.”
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