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The U.S. Treasury’s Financial Crisis Warning Bell Didn’t Ring Before the Repo Crisis of 2019 or This Year’s Bank Runs

November 30, 2023

by Pam Martens and Russ Martens Wall Street on Parade

The Office of Financial Research (OFR) is a unit of the U.S. Treasury Department. OFR was created as part of the Dodd-Frank financial reform legislation of 2010 to keep the Financial Stability Oversight Council (F-SOC) informed about emerging threats that have the potential to spread contagion throughout the U.S. financial system — as occurred in 2008 in the worst financial crash since the Great Depression.

Janet Yellen, the U.S. Treasury Secretary, chairs F-SOC. Its members include the heads of every federal banking and Wall Street regulator, who meet regularly to assess any threats on the horizon that could lead to financial instability in the U.S.

One of the data charts that OFR makes available both to F-SOC and the public to assess accelerating financial problems is its Financial Stress Index. OFR describes that index as follows: