Wamu couldn't have been in better shape. If they were then they would have been able to borrow from the discount window; which is the lender of last resort. The Fed apparently cut them off from the Window because they had no assets worth pledging against the borrowings.
Isn't the FED discount window ran by it's member banks such as JPM and doesn't Jamie Dimon sit on the FED BOD? Was Wamu a member bank as well? Not to mention the fact that Wamu was solvent which didn't require them to borrow from the discount window. And, if I remember correctly they had a 50 billion LOC they could have gotten from the FED discount window (stated to Congress during the economic disaster investigation
I don't believe Wamu ever got a chance to get any additional funds as they were not under the impression there was a need and were not required to have additional funds raised. Last thing Wamu did was emailed OTS to inform them they could raise additional capital if required and had a plan to do so. Wamu was solvent up to and including at the time it was seized - THIS WAS STATED BY THE OTS the day of the seizure.
The Clearing House said in its court filing that the Fed has never revealed the identities of borrowers from its discount window, the lending facility where banks get short-term funding and the source of the 2008 emergency loans. Has the FED ever been asked to before? Is this not required of a govt authorized business? They have the ability to print our dollars and increase our inflation, I believe they should not only be inclined to abide by the FOIA, but they should also be audited on a regular basis!
According to that defense, depositors, fearing the loss of their life savings, might cause a run on institutions named as having accepted emergency loans. If the FED was lending large amounts to JPM/C/BOA/WF while they were buying/acquiring these other failing banks, even if JPM/C/BOA would have been failing without the loans, then this would basically show favoritism to these banks and not for banks such as Wamu & the many smaller regional banks which were seized. We all know Wamu was just for JPM, Wachovia was supposed to be for C but WF messed that up, etc...
Now, with it coming out that the FDIC/Sheila Bair under investigation for trying to save Shorebank out of Chicago and calling in a few favors (then having to seize anyway after Wall St & the Tarp funds) definitely shows there was some agenda behind it. What other banks has Sheila been FOR saving? Not Wamu, they were seized while solvent through pushing from the FDIC, and then sold (gifted, whatever you'd like to call it) to JPM for pennies on the dollar. Not to mention that Sheila was working against Wamu trying to sell itself and/or part of itself during that time.
