When the US Congress passed the monstrously large Dodd-Frank financial reform bill last summer, it was clear that surprises were lurking in those 2,300 pages. This week one has cropped up.
On Wednesday, the US Federal Reserve released the details of the liquidity measures and loans it extended during the financial crisis, totalling an eye-popping $3,300bn. Previously, the Fed fiercely resisted publishing this. And it is easy to see why: this release names individual institutions in a potentially embarrassing way – and shows that the Fed has supported foreign banks, ranging from Barclays Capital to Dexia, to a striking degree.
But while that is profoundly sensitive stuff, the Fed was forced to publish because of a tiny, hitherto ignored clause inserted into that Dodd-Frank bill. Hence that surprise.