Jim Grant on insolvency risk at the Federal Reserve

The Fed runs no risk of insolvency no matter how encumbered it becomes (it was leveraged 196.8:1 as of the March 24 statement date) or how exposed its bulging bond and mortgage portfolios might be to the risk of rising interest rates.  It doesn't matter because, in 2011, the Treasury agreed to become the guarantor of the Fed's solvency.

~ Jim Grant, "Chair Powell on the beaches," Grant's Interest Rate Observer, April 2, 2021