Quote:
Originally Posted by GermanBJJ
Your FED numbers don't take into account the Shadow Banking system, only the regulated commercial banking system.
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This is a good post and legitimate point BUT my understanding is that this system does not originate a great deal of loans (especially home loans). At the peak, commercial banks originated about 50% of corporate loans with hedge funds, private equity funds, GE commercial finance, etc. originating the remaining 50%. This market has dried up…which is why those of us in commercial banking have been so busy.
The “shadow banking” system does do the bulk of derivatives and purchases quite a bit of distressed debt (and non distressed debt) on the secondary market but not a great deal of originations. I will check the Gold Sheets (an lending industry trade publication) and see if I can get some numbers.