The biggest banks operating in the U.S. reaped an estimated $13
billion of income by taking advantage of the Federal Reserve’s below-market
rate of .001% on $7.7 trillion in emergency loans in the wake of the credit
freeze in September 2008. Rather than using the
additional funds to increase lending, the banks fortified reserves and paid
bonuses out to executives. Had member of Congress had been able to anticipate
all this, it is possible that they would have prescribed stronger medicine,
perhaps even including breaking up the banks with over $1 trillion in assets.
The full essay is at "Can the Fed Handle Banks Too Big to Fail?"
