A week has gone by since the staged show of support for the Fed at the discount window by the four biggies. Back then, I called the real borrowings during the preceding week “Substantially Zero.” Last week, if you subtracted out what we knew about who borrowed the $2 billion and believed them when they said they did not need the money other than to show support for the Fed - you got substantially zero borrowings from the troubled banks that are supposedly requiring all this intervention. So when the new H.4.1 report came out this afternoon, I was very interested to see how much borrowing went on during the past week.

The way I look at the numbers, this week was “Less Than Zero.” The ending balance of Primary Credit as of this Wednesday was $1.101 billion, down from $2 billion last week. Furthermore, the previous balance of $85 million in Secondary Credit was drawn down to $0. The net result was a repayment of about $1 billion at the discount window compared to last week. If you read the major financial media’s stories on this week’s report, you’ll see headlines that tell you the average borrowing increased to $1.315 billion compared to last week’s figure of $1.2 billion. Of course this is a pretty odd way of looking at things. It almost makes you believe that banks are borrowing from the discount window. Sorry, but I just don’t see it that way.

Just do some math on a simple average of seven daily balances. We know the first day was $2 billion (last week’s close) and we know the ending balance was $1.101 billion. Make some assumptions that the biggies repaid $1 billion of the $2 billion during day 3 and kept the other $1 billion as a wonderfully patriotic and continuing sham show of support for the Fed and you can easily create an average around the $1.315 billion reported on the H.4.1.

So in the two weeks after the Fed intervention what do we know? We know that the well-timed announcement screwed the shorts in the stock market and provided a nice bailout rally for the longs. We know that it made Chairman Bernanke and the Fed look very creative, innovative, brilliant (insert other nice adjectives here). But did it result in any actual borrowings by the banks? The way I look at it - IT DID NOT. Things like this really contribute to the claim that the intervention has done a lot to bail out equity markets and not much for the banking system.