The Fed lent not only to banks, but, seeking to stem the panic in wholesale funding markets, it also extended its lender-of-last-resort facilities to support nonbank institutions, such as investment banks and money market funds, and key financial markets, such as those for commercial paper and asset-backed securities.
Arguably the Fed's most important and most controversial actions during the crisis were to extend its lender of last resort authority to nonbanks, in effect creating actual money to redeem the private money no one wanted any longer.While QE, as Mr Stein says, reduces the supply of private money, it doesn't alleviate the demand for private money.
He's pushing extended warranties and lender's loans from vendors like SunTrust and Chase.
Lenders extended credit to people without verifying their incomes and allowing them to make little or no down payments.
In December, Dresdner Bank, one of Kirch's main lenders, extended the term of a secured loan of euro460m only after it was given additional security.
Credit card lenders extended $12.5 billion in loans to subprime borrowers last year, up 54.7 percent from 2010, according to Equifax and Moody's, but still below the $41.6 billion in 2007.
As at Riverton and Stuyvesant Town, lenders extended large loans for Savoy Park based not on actual rental income but on income projections that turned out to be significantly overstated.
The lenders extended the money, while the College Board received a fee from them for serving essentially as a gateway for borrowers.
Mr. Greenspan went on to note that household debt burdens had been rising for the last half-century as lenders extended credit to wider segments of the population.
During the housing boom, lenders extended multiple mortgages, like home equity loans, to homeowners, often enabling them to overextend their finances.
