Okay, I think around November some off balance sheet items for banks were made to come on the books. These included a lot of subprime mortgages, so this accounted for the sudden difference in the reserves.
But what you uncovered in the notes is really interesting. Discount window borrowings are almost zilch now compared to the special auctions now being held for banks, and the rates are below the discount window rates.
See--
http://online.wsj.com/article/SB120040939637591379.html?mod=googlenews_wsj So, the "change" to subtract out "discount window borrowings" now rather than "total borrowings" looks highly suspicious to me.
Where are the borrowings from these new auctions being reflected in this graph. Are they being left out? Is this situation much worse than even these figures?
Does anyone want to take a guess at this?
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