By Silla Brush - 08/19/10 04:35 PM EDT
Risky investments the Federal Reserve made to prop up the economy are on pace this year to return record profits to taxpayers, according to the Congressional Budget Office.
The central bank bought more than $1 trillion of mortgage-backed securities to help the housing market and stimulate the economy overall. In a report Thursday, the nonpartisan CBO said the riskier investments mean more profit, which is returned to the Treasury Department each year.
The report estimates the Fed will return $73 billion this year to the Treasury Department, nearly double last year's total.
Over the last few years, the Fed has witnessed steadily increasingly profits, but the 2010 haul might be a record. The return on the investments is expected to decline after 2011.
The central bank said this month that it would continue its current level of investments to help fend off an economic slowdown. The bank said that as mortgage-backed securities mature, it would shift the investments into more conventional and less risky Treasury securities.