what is the fed balance sheet 
the fed balance sheet is a statement listing the assets and liabilities of the federal reserve system details of the fed s balance sheet are disclosed by the fed in a weekly report called factors affecting reserve balances 1understanding the fed balance sheetthe fed is the central bank of the united states founded by congress in 1913 to ensure the stability of the nation s financial and banking systems in times of crisis 2for much of its history the fed s balance sheet was a sleepy topic issued every thursday the weekly balance sheet report counts the assets and liabilities of the federal reserve by type just as a corporate balance sheet does providing a consolidated statement of the condition of all 12 regional federal reserve banks 1the fed s assets consist primarily of government securities it has bought and credit extended to banks and other financial institutions 1 its liabilities meanwhile include bank and treasury reserve balances on deposit with the fed as well as u s currency in circulation 3the weekly balance sheet report became more important as a financial and economic indicator after the 2008 financial crisis when the fed initiated a policy of quantitative easing qe 4 the fed balance sheet gave analysts added insight into the scope and scale of fed market operations in particular it allowed analysts to monitor the pace of asset purchases the fed balance sheet and quantitative easing qe qe is a monetary policy in which a central bank purchases large quantities of government bonds or other securities on the open market in order to hold down long term interest rates and signal loose monetary policy the fed and other central banks have used quantitative easing also known as large scale asset purchases to support economic growth beyond what could be achieved by lowering short term interest rates to zero the policy has drawn political criticism but has become an increasingly common response to economic and credit crises used effectively by the european central bank and the bank of japan alongside the fed special considerationsthe fed s balance sheet may look somewhat like a corporate one but central banks are unique in their unlimited supply of currency in contrast to a corporation the fed and other central banks exist not to make money but to ensure economic and financial stability the fed s role is akin to that of the bank in the board game monopoly its goal is not to win but to supply enough money to keep the game going the right amount of assets for the fed is that which best enables it meet its mandate 