Central bank policies create hidden losses and distortions that favor elites over regular people. Paying high interest on reserves while holding long bonds flips normal central bank profits into losses. This keeps government borrowing cheap but builds bigger problems for the future.
A former World Bank president warns that the Federal Reserve has lost over a trillion dollars, essentially operating as a massive hedge fund for the wealthy.
By borrowing from banks at 5.4% interest to buy Govt. bonds, the Fed artificially masks the true severity of Govt. debt. pic.twitter.com/1PVWGeWJwk
— David Rogers Webb (@DavidRogersW) July 4, 2026