Fed Released Details Of Its Emergency Lending (To Save The World) In 2007

Posted By on December 1, 2010

Under orders from Congress pursuant to the Dodd-Frank financial legislation, the Fed has finally released details of its emergency lending starting in 2007.

Huffington Post is providing an excellent live-blogging round up as new discoveries are made from the Fed’s data release. Here are some of the more interesting insights:

Mutual funds, hedge funds and bond funds borrowed more than $71 billion from the Fed’s Term Asset-Backed Securities Loan Facility, the WSJ reported. This includes $7.1 billion borrowed by the massive bond fund PIMCO, run by veteran investor Bill Gross. Gross’s involvement in the details of the bailout, which included a campaign for public-private partnerships to unwind toxic assets, raised more than few eyebrows from critics.

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Two European Megabanks Got A Windfall From The Fed … Two European megabanks — Deutsche Bank and Credit Suisse — were the largest beneficiaries of the Fed’s purchase of mortgage-backed securities. The Fed’s dollars also flowed to major American companies that are not financial players, including McDonald’s and Harley-Davidson, through unsecured short-term loans.

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Wall Street firms teetering on the verge of collapse pledged more than $1.3 trillion in junk-rated securities to the Federal Reserve for cheap overnight loans….

The fact that Wall Street was able to pledge junk to the Fed in exchange for cheap financing is likely to enrage lawmakers who view the Bush and Obama-era crisis programs as largely benefiting Wall Street while “Main Street” has been left behind.

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