One of the risks of quantitative easing is that the Fed could lose money on its purchases when the assets are sold back for less.

Question

Quizplus · Accepted Answer

When the Fed purchases assets through quantitative easing, they are essentially increasing the money supply, which can lead to inflation. As a result, the Fed may eventually need to sell off those assets to combat inflation. However, if the market value of those assets has decreased, the Fed could potentially lose money on the sale, resulting in a financial loss.

One of the Risks of Quantitative Easing Is That the Fed