The Fed released detailed data on more than 21,000 loans worth trillions of dollars made through a dozen emergency programs created during the financial crisis.

From Pro Publica’s interactive department: Which Banks Got Emergency Loans from the Fed During the Financial Meltdown?

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click for interactive table

Category: Bailouts

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

37 Responses to “Which Banks Got Fed Loans During the Meltdown?”

  1. Lugnut says:

    I’m surprised theres no restrictions or oversight over the degree and amount that the Fed can arbitraliy dole out money to foreign entities and counter parties.

    I don’t know why exactly I am surprised, but I am none the less.

  2. Gator81 says:

    I think the table has a labeling problem. The money columns are labeled “millions”, but I’m thinking maybe that should be “thousands”. On the other hand, I’ve certainly had some trouble getting my head wrapped around the size of some of the numbers involved in this business. But really… did Citi, Merrill, and MS get over two trillion dollars in loans? EACH? I can see billions… maybe tens of billions… but I’m having eye trouble with trillions… please, somebody – a little help here?

  3. Mannwich says:

    @Gator: FWIW – As astonishing as it may seem, I believe the “trillions” figure is right, as I’d seen it elsewhere.

  4. Moss says:

    This should prove once and for all that all the big banks would have failed. They all should have been nationalized.

  5. Mannwich says:

    As if we need more proof, Moss? LOL. But, hey, Goldman didn’t need the bailouts.

  6. notakid says:

    Trillions is the figure and after all since we have stress tested them they MUST be all better now….I am sure of it.

    They can’t become solvent anymore not enough printers in the world.

  7. call me ahab says:

    I’m surprised theres no restrictions or oversight over the degree and amount that the Fed can arbitraliy dole out money to foreign entities and counter parties.

    in a nut shell- the rationale for opening up the spigot to forgein owned banks were fears that these same banks would unload MBS at even more distressed prices to generate dollars ( to cover demands for payment they were receiving)-

    it was an all out effort to protect asset prices-

    legal or not? I have no idea (as if the Fed cares)

  8. notakid says:

    Goldman was FULLY HEDGED —yeah if only I had a BERNANK in the Bush.

  9. Gator81 says:

    Okay… for the first time since the flash crash, I am actually feeling physically ill. I may hurl.

    The “total” column in that table adds up to about $14.65T.

    According to the IMF, the GDP of the United States in 2009 was about $14.3T, and that number is about 1/4 of global GDP.

    So it was necessary to lend those 100 banks an amount equal to three months’ production of all the people on the planet earth. All at once.

    This stretches my understanding of the concept of “lend”. So… somebody at the Fed sat down at a secure terminal somewhere, pulled up the account for Citigroup, and credited the account for $2.4T, more or less. “Here you go, Mr. Pandit, now be careful and try not to lose it. Next!”

    I guess I’m going to have to buy Barry’s book, or I’ll never understand this. I have a degree in economics. It isn’t helping.

  10. Mannwich says:

    @Gator: Well, they couldn’t lose it when they were buying stocks, commodities and treasuries all at once. That might explain the no losing trading days every quarter by these banks. Honestly, it’s beyond absurd at this point, but nobody really cares now that the “recovery” is in full swing, so they probably figure they can just keep doing what they want, and then some. LOL.

  11. Mannwich says:

    ….while swapping out their trash “assets” to the Fed (will ultimately be the taxpayer) for actual dollars. It’s actually the perfect crime, I mean, deal, on their part. Get super rich on fake short term paper “profits” driving the bubble and then when the excrement hits the fan, get bailed out by the very suckers you fleeced to make said “profits”, pay y0urselves huge bonuses with part of that bailout money, and then do it all over again. What’s not to like if you’re them? Hard for me to see a downside. LOL.

  12. wally says:

    I thought the chart numbers were off, too. These amounts are beyond belief.

  13. Arequipa01 says:

    When I look at these numbers it seems to me that these banks were in a Mexican standoff until Bernanke showed up and send “Just turn around and shoot everyone else on the planet”.

    Soybeans: 1298.00
    Rough rice: 1475.50

    He is taxing the caloric intake of every single person on the face of the earth.

  14. [...] by Charles II on December 3, 2010 Via Barry Ritholtz, you can find out how the October 2008 (Emergency Economic Stabilization Act which funded TARP) [...]

  15. Tarkus says:

    Ok. Now I know what “fully hedged” means.

    Thanks!

  16. obsvr-1 says:

    I think the term is Fully FEDged …

    The large nominal amounts of the loans is from the cumulative amount loaded over a period of time, there was never $10-14T of loans outstanding. The FED was operating a repo market with crap collateral while the banks were being bailed out of their liquidity crisis. Since all of the TBTF were massively interconnected, the liquidity crisis spread like cancer throughout the International markets.

    The FED may have saved the economy from the brink of disaster, but the TBTFs should have been wound down through a resolution process and/or bankruptcy after the FIRE was put out.

    The important thing to note is the $2T in crap that was left on the FED balance sheet and what the FED ultimately paid the banks for said crap (since this was a backdoor bailout for the banks it was likely face vaule) and to find out where the left over collateral (Crap) wound up on the banks balance sheet since the Mark to Fantasy is being utilized.

    I would like to help the FED with QE and sell the them my house and real estate investments for face value — it would certainly help my balance sheet and liquidity.

  17. Sunlight shows cracks in crisis rescue story
    Frank Partnoy FT December 3 2010
    http://www.ft.com/cms/s/0/6ea84d76-fe54-11df-abac-00144feab49a.html

    It took two years, a hard-fought lawsuit, and an act of Congress, but finally on Wednesday, the Federal Reserve disclosed the details of its financial crisis lending programmes. The initial reactions were shock at the breadth of lending, particularly to foreign firms. But the details paint a bleaker, earlier, and even more disturbing picture. They also highlight new tensions over high-tech transparency, echoing the controversy of the WikiLeaks cables, unveiled just days earlier.

    The Fed uploaded to its website several giant spreadsheets giving details on about 21,000 of its recent transactions. This data dump wasn’t willing: it was a response to litigation by Bloomberg, and a provision in the Dodd-Frank financial reform law requiring disclosure.

  18. gfb615 says:

    Barry, you might correct the spelling of disappointment in the item below. It looks silly – especially in a headline.

  19. DeDude says:

    The trillion is standard misinformation from the media because their advertising revenue is directly proportional to the outrage their stories create. Their business model doesn’t have anything to do with how informed or misinformed the reader gets from what they spew out.

    You get to a trillion in this overnight lending business by counting every overnight loan as a separate additive entity. So if Citi loans 40 billion overnight for 100 days then they have borrowed 4 Trillion from the Fed, newer mind that they at any given night newer exceeded 40 billion of Fed dollars, but the fuzzy math have them listed as having been “doled out” or “written a check for” 4 Trillion. Yes the big guys were in big trouble when credit froze and it took a lot of days before they could get overnight loans from anybody else but the Fed – those who are surprised are either morons or have been asleep since high school.

    The only relevant information of “maximum Fed outlay” to each institution (and in total) at any time during the whole crisis – is also the only information not available because that does not sell so well.

    Combining the fact that the media is in the misinformation business with the fact that most people speed read and are twice as fast at getting outraged as they are at turning their idiot brains on – and we have a winner (somewhere in Asia).

  20. obsvr-1 says:

    @Barry Ritholtz Says:
    December 3rd, 2010 at 2:40 pm

    Sunlight shows cracks in crisis rescue story
    Frank Partnoy FT December 3 2010
    http://www.ft.com/cms/s/0/6ea84d76-fe54-11df-abac-00144feab49a.html

    —- Reply

    Excerpt from the article: The Fed charged low rates, often almost zero per cent. It says these rates were justified because loans were “fully secured”. However, unlike some Fed disclosures, the data include only the face amount of the collateral, and vague categorical labels. The Fed admits some collateral was inadequate. But without more details we can’t know whether the loans were fully secured, or whether the Fed, by lending at low rates without adequate collateral, was effectively gifting money to borrowers around the world.

    * There should be renewed calls for a full scale criminal investigation of Paulson, Geithner and the FED — the sunlight is showing more and more of the illicit and unlawful actions by these whom swore to uphold the constitution, the law and duty to the citizens (taxpayers). I continue to see high crimes, widespread corruption and the use of Financial Terrorism (“… if we don’t do this the economy will crash and there will be tanks in the streets …”) to justify their actions.

  21. Moss says:

    What is even more amazing is that the failure of only one corrupt institution, LEH, caused a complete and lasting meltdown. I hate to imagine what will happen when the Fed starts even talking about an exit strategy. Any ‘natural’ market for the crap used as collateral, and half of the Fed’s balance sheet, has no market. Interest rates would skyrocket, just ask PIMCO.

  22. DeDude says:

    Moss;

    It only takes one yell of “FIRE” in a crowded theater to create a deadly stampede. LEH gave a huge number of preciously confident people the realization that one day you give a short tem loan to what you perceived as an “established solid company” and the next day the money is gone forever. As a result nobody dared to loan any money to any “established solid companies” until they with their own (accountants) eyes had established that the company really was “solid”. We are not going to have a panic when the Fed starts their exit, it has been advertised since their entrance, so nobody will be surprised.

  23. Malthus says:

    One of Partnoy’s points is that some of the lending started in 2007. To me that raises a couple of additional issues:

    1. The FED knew in 2007 there were problems but by keeping its lending secret it allowed all these problems to fester.
    2. The FED had a vested interest in the bailouts in 2008 because of the money it lent out at low rates in 2007 and IT DID NOT DISCLOSE THIS at that time.

    Am I wrong here or is this a scandal within a travesty?

  24. Jojo says:

    Then there were the wealthy individuals who also got into the game. The little guy, of course, gets left out, as always.
    ————
    NY Times
    December 2, 2010
    Cross Section of Rich Invested With the Fed

    WASHINGTON — One investor, Kenneth H. Dahlberg, is a World War II flying ace who, as a volunteer in President Richard M. Nixon’s re-election campaign, was a minor figure in the Watergate scandal.

    Another investor, Magalen O. Bryant, runs a horse farm in Virginia and is active in steeplechase racing circles. A third, Ward W. Woods, is the chairman of the nonprofit organization that runs the Bronx Zoo.

    They were among scores of wealthy but lesser-known investors in an emergency lending program the Federal Reserve announced in November 2008, three weeks after President Obama’s election, to support the market for student, auto, credit card and small-business loans.

    The investors, whose identities were disclosed as part of a trove of 21,000 records released on Wednesday at the direction of Congress, are a cross-section of America’s wealthy — investors who, in the midst of the worst financial crisis since the Great Depression, heard about an opportunity and weighed the risk.

    The list, not surprisingly, includes famous Wall Street financiers like J. Christopher Flowers, John A. Paulson and Julian Robertson, demonstrating the extent to which the Fed relied on fast-moving hedge funds to keep credit flowing through the markets.

    There were also institutional investors like the Ford Foundation and the pension plan for Major League Baseball. And there were wealthy businessmen like the computer executive Michael S. Dell and the home builder Bruce E. Toll.

    …………

    http://www.nytimes.com/2010/12/03/business/economy/03fed.html

  25. Mannwich says:

    @Malthus: Oh, I’m sure they had an inkling back in ’07 (or even further back than that), but they just weren’t saying so publicly.

  26. Moss says:

    @Dedude:

    I beg to differ. What happened to the ‘market’ when the Fed’s QE1 ceased? It tanked and they immediately announced that they would re-invest the MBS portfolio proceeds. In addition any talk of exit, which was on the tongue of many in the Spring, has now been replaced with QE2 activities. The Fed will be forever standing in for the now defunct shadow banking scheme. If they do sell the crap it would be at a very steep discount. I would love to see the collateral that the TBTF banks pledged. This bit of info would destroy any credibility the Fed and the banksters have left.

  27. DeDude says:

    Jojo;

    Oh my good the Fed wanted private sector investors (so they didn’t have to use federal money) and they contacted wealthy individuals rather than every John, Dick and Harry with $500 in their checking account. That is absolutely a front page worthy scandal :-)

  28. DeDude says:

    Moss;

    What happened from September 08 to March 09 that is called market “tanking”. The reaction to QE1 ceasing is called a minor correction. Put some proportions on it. Those two events simply are not comparable. Nor will a slow easing out of QE from the Fed induce anything like the free fall of October 08.

  29. Moss says:

    Dedude:

    I guess you should watch 60 minutes. There will be no ‘slow easing’ out of QE. Had the Fed not acted after QE1 ended and the minor correction we would NOT be at 2010 highs. The market participants have the Fed hostage much like the bond vigilantes have the ECB hostage.

  30. Darkness says:

    >We are not going to have a panic when the Fed starts their exit,

    And when will that be happening, exactly?

  31. Darkness says:

    Sorry for the double post, but looking over the list of counterparties again and the way it stinks of wretched high school boys’ locker room panic, even at this later date. . . Are we going to bail out China to keep them from dumping all of our paper on the market to generate cash?

  32. daf48 says:

    Can we just leave out the word “Capitalism” in further discussions. We don’t live in a Capitalistic economy. I’ll leave it to you to provide the appropiate adjective. “Fascism”? “Oligarchy”? “Plutoarchy”?

  33. DeDude says:

    Gator81;

    This is part of the plan from our corporate masters and their little media-puppets. You are supposed to be overwhelmed by all kinds of faked outrageous events such that the real outrageous events just blend in as one of to many to comprehend and react to. If they can get you to focus your outrage on the only power that actually could challenge them and their actions, then its even better for them. You lets all hate big gobinment and everything gobinment so there will be nothing that can stand in the way of the big boyz. Just get comfortably numb by faked outrages before they rape you again.

  34. DeDude says:

    Moss; absolutely we probably would be slightly lower now than where we were after QE1 rather than at 2010 highs, but we would not have been even close to the kind of drop we had from Sept 08 – March 09. QE2 is a spit in the pan and will have limited effects in either direction. I fear that as much “stimulation” as it may produce for the economy will be taken away from the economy because of its addition of fire to the commodities speculation party (and associated consumer price increases). So the net stimulatory effect will be close to zero, stocks and inflation will get a moderate boost and nothing drastic will happen, because the real problems have to be solved by our deadlocked congress not the Fed.

  35. louis says:

    It’s called a virtual world, the more imaginary money you have the more risk you can take with the lower classes real money. When your bets don’t pan out you are able to gain access to more real money, again from those below you. If you on the other hand partake in this virtual world you will eventually be crucified.

  36. notakid says:

    YOU will have a panic no matter what the fed does.
    It’s baked in the cake. Nothing has been fixed or solved and won’t be on this path.

    prepare.