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Billionaire investor Warren Buffett compared the U.S. Federal Reserve to a hedge fund because of the central bank’s ability to profit from bond purchases while accumulating a balance sheet of more than US$3 trillion.

[np_storybar title=”Why the Fed is the only central bank that matters” link=”http://business.financialpost.com/2013/09/19/why-the-fed-is-the-only-central-bank-that-seems-to-matter/”]Analysis: The BoC and U.S. Fed made similar statements on the same day, but markets went ballistic only after Bernanke announced there would be no tapering. Read more

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“The Fed is the greatest hedge fund in history,” Buffett told students Thursday at Georgetown University in Washington. It’s generating “US$80 billion or US$90 billion a year probably” in revenue for the U.S. government, he said. “And that wasn’t the case a few years back.”

The central bank has been buying US$85 billion of bonds a month to help the U.S. recover as it emerges from the deepest slump since the Great Depression. Chairman Ben S. Bernanke and other Fed policy makers unexpectedly opted this week to sustain that pace of asset purchases instead of tapering it, saying they need to see more signs of lasting improvement in the economy.