The Fed wanted to help banks, so Steinhardt turned himself into a shadowbank: He borrowed short and lent long, just like any bank would do. The difference was that Steinhardt bypassed the tedious business of hiring armies of tellers to collect customer deposits and flotillas of credit officers to lend the deposits on to companies. Instead, he borrowed from brokerages such as Goldman Sachs and Salomon Brothers, then lent by buying bonds.
