The highway measure would be financed in part by a one-time use of Federal Reserve surplus funds and by a reduction in the 6 percent dividend that national banks receive from the Fed. The dividend would be reduced by an amount tied to yields on 10-year U.S. Treasuries, currently about 2.2 percent. If Treasury yields rose higher than 6 percent, the Fed wouldn’t pay the banks more. Banks with $10 billion or less in assets would be exempt from the cut.So, what everyone has been waiting for: Inflation.
The Fed’s surplus capital comes from the 12 reserve banks. The highway bill would allow for a one-time draw of $19 billion from the surplus, which totaled $29.3 billion as of Nov. 25.
It will be a terrible, shrill wife from whom we cannot be unmarried. Thank God...the marriage will be short; the only sliver of good news in an almost unbearable and suffocatingly pile of bad news of what is in store for our nation.