Whatever you thought you knew about the 2008 bank bailout is wrong…

…because the reality is over 10 times worse than what was made public at the time. In fact a total of $7.7 trillion in loan guarantees and lending limits were issued by the Fed, which makes TARP seem like a trifle in comparison.

Is the Fed speaking out of both sides of its mouth?

Ben Bernanke spent a lot of time in front of Congress on Tuesday arguing that there’s a credit crisis out there, so why did the Fed recently shrink the float by $125 billion and why is it still resisting a consensus-recommended half-percent rate cut? Is it, as some paranoid people could suggest, a way to generate a need for an all-encompassing mega-bailout plan?