Federal Reserve made $9 trillion in emergency loans - Dec. 1, 2010
Fed made $9 trillion in emergency overnight loans
Top recipients of overnight loans made by the Federal Reserve under special program that ran from March 2008 through May 2009.
By Chris Isidore, senior writerDecember 1, 2010: 6:05 PM ET
NEW YORK (CNNMoney.com) -- The Federal Reserve made $9 trillion in overnight loans to major banks and Wall Street firms during the financial crisis, according to newly revealed data released Wednesday.
The loans were made through a special loan program set up by the Fed in the wake of the Bear Stearns collapse in March 2008 to keep the nation's bond markets trading normally.
The amount of cash being pumped out to the financial giants was not previously disclosed. All the loans were backed by collateral and all were paid back with a very low interest rate to the Fed -- an annual rate of between 0.5% to 3.5%.
Still, the total amount was a surprise, even to some who had followed the Fed's rescue efforts closely.
"That's a real number, even for the Fed," said FusionIQ's Barry Ritholtz, author of the book "Bailout Nation." While the fact that the markets were in trouble was already well known, he said the amount of help they needed is still surprising.