The Federal Reserve paid a record $46.1 billion to the U.S. Treasury in 2009 increasing by $14.4 billion its 2008 payment. It was the largest payment since the central bank was created in 1914. Its total 2009 net income of $52.1 billion also was a record.
"This is a silver lining in that big cloud of the Fed having to intervene massively and expand its balance sheet. " said Nariman Behravesh, chief economist of Global Insight.
Fed Chairman Ben Bernanke and the Fed Board took unprecedented actions to prop up the financial system in the past year and a half. As their results continue to produce healthy outcomes, they now have the benefit of withering criticism from lawmakers bent of limiting the Fed's authority.
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