1. Financial Crisis

    Fed Lent $1.2 Trillion to Banks

    PASADENA, CA - JULY 28:  A man uses an ATM at a Bank of America branch on July 28, 2009 in Pasadena, California. A bank spokesperson announced plans to close about 10 percent of its branchesf which will reduce its US network of 6,109-branches over the next three to five years, eliminating thousands of bank jobs, as customers do more online and telephone banking. The move reverses years of expansion by the nationÕs largest bank which faces growing losses from credit card and mortgage loans.  (Photo by David McNew/Getty Images)

    David McNew / Getty Images

    Freedom of Information Act requests by Bloomberg News reveal for the first time the extent of the Federal Reserve’s lending during the 2007–08 financial crisis. At its peak in December 2008, the Fed lent $1.2 trillion—the same amount that U.S. homeowners currently owe on bad mortgages. Citigroup and Bank of America borrowed the most, needing $669 billion. (In their best year ever, 2006, those two banks totaled $104 billion in profits.) Many foreign banks also received rescue funds; nearly half the top 30 borrowers were European. Royal Bank of Scotland took the most with $84.5 billion, while UBS took $77.2 billion.

    Read it at Bloomberg News