How Does the Federal Reserve Work?


The Fed has a board of governors whose job it is to decide monetary policy and to adjust interest rates and issuance of money to meet the needs of the United States and, presumably, not to be influenced by political considerations.


The Federal Reserve pays to have the money printed. Then, when it gets the money, it loans it to the United States in return for Treasury Bonds, which pay interest. The Federal Reserve Act is written that way. They are literally making money off the currency of the United States and none of that money has really ever been paid back. It has been collecting interest at anything from four percent up, since 1919.  They maybe get about three-hundred billion dollars a year in interest, all of which is paid to the stockholders and eventually ends up in Europe.