ARTICLE: How the Fed let small banks take on too much debt, then fail

Data emerging from the carnage of collapsed and teetering banks leaves little doubt that the Fed rule, and regulators' failure to adequately police the issuance of these securities, created big cracks to the already shaky foundations of the nation's banking system.  A four-month McClatchy inquiry found that the Fed rule enabled Wall Street to encourage many community banks to take on huge debt and to plunge the borrowings into risky real estate loans.

Read more...