But unlike expenses at federal agencies such as the State Department or the Pentagon, none of the Fed’s spending comes out of taxes paid by Americans. The central bank is a decentralized institution that funds itself rather than relying on appropriations by Congress to operate. In fact, it often sends money to the U.S. Treasury.

Cumulative losses are added to a “deferred liability” on the Fed’s balance sheet, which it must pay down to zero before beginning to send money to the Treasury again. As of last week, that balance was about $214 billion. The net loss doesn’t affect the Fed’s ability to operate: It can create new money out of thin air.