The Fed just released the transcripts from its 2008 FOMC meetings. The document release also came with accompanying presentation materials.
For the September FOMC meeting, which was right at the height of the financial crisis, the New York Fed’s Bill Dudley brought a stack of charts. And the first two are horrific.
The first chart shows investment bank stock prices, which crumbled on fears of insolvency. Similarly, the second chart shows surging bank credit-default swap (CDS) spreads. CDS is basically insurance against a default.
For the banks that walked away from the crisis, prices came back CDS spreads crumbled.