Congress Pries Open the Fed -- Audit Report Drops TodayDecember 1, 2010 - by Donny Shaw
The graphic above shows the explosion of the Federal Reserve’s balance sheet during the financial crisis (interactive version here). What you see happening around 10/08 is the Fed aggressively ramping up their subsidies to financial institutions, via a variety of programs, in order to help them ride out the storm. This is bailout activity that is separate Congress’ TARP program and according to some estimates could total as much as $5 trillion.
Today, thanks to the Dodd-Frank financial reform bill (exact provision here), we get to begin learning which companies benefitted from these subsidies, how much they got, when they got it, and what the Fed got/is expected to get in return. The law also asks for “the specific rationale for each such facility or program.” Previously the Fed had only made aggregate data of their crisis response public, and that’s what we see in the chart above.
The Fed report has just been released, you can access it here. We’ll undoubtedly be hearing the details of the reports over the next few days, and some initial analysis has already been filed: NYT, HuffPo, FT, Reuters, TheStreet… For less formal, real-time analysis, you can also follow Zach Carter and Zero Hedge as they live-blog their data-digging throughout the day.