Bert Ely on lending.

• Author: Rees, Matthew
• Position: Institutional lending

"Lost in too many discussions of the financial sector is that banks and other depository institutions account for only 22 percent of the credit supplied to the U.S. economy (down from 40 percent in 1982). 'Shadow banking'--notably asset securitization and money-market mutual funds--now supplies 33 percent (up from 14 percent). Insurance companies, other financial intermediaries, nonfinancial firms and the rest of the world provide the balance."

"As far as commercial banks go, Federal Reserve data released last week show that their lending increased 2.36 percent during the last quarter of 2008. For all of 2008, commercial-bank lending rose by $386 billion, or 5.63 percent, even as the...