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Back then, a range of institutions were floundering, not just commercial banks.

The failures this year of First Republic Bank, Silicon Valley Bank and Signature Bank have been labeled the second-, third- and fourthlargest bank failures in U.S. history. By one measure, the three banks held more assets than all 25 banks that failed in 2008 during the global financial crisis. Wait a second: this wave of failures is as bad as the 2008 crisis? The one that caused the Great Recession, street protests, trillion-dollar bailouts and a total overhaul of financial regulation? The answer is, of course not. These just happen to be the wrong numbers to compare the two episodes, and for three reasons. First, they aren’t adjusted for inflation. Second, they compare only banks, not big firms that got into trouble that weren’t banks. And third, they only look at failures, not firms that would have failed without a bailout. So far this year, the Federal Deposit Insurance Corp. has taken over First Republic, with $229 billion in assets; Silicon Valley Bank, with $167 billion; and Signature Bank, with $110 billion, for a total of $506 billion. In 2008, the FDIC took over 25 banks with total assets of $373 billion, a figure dominated by what’s still the largest FDIC-managed failure on record: Washington Mutual, with $327 billion in assets. But this misses most of the firms at the center of the 2008 crisis. “The FDIC is not the only thing to look at,” said Simon Johnson, an economist at the Massachusetts Institute of Technology who was chief economist at the International Monetary Fund in the early stages of the crisis. A range of institutions were floundering, not just commercial banks. In the fall of 2008, there was “wellfounded concern about the health of the largest banks,” said Mr. Johnson. “With the caveat that this one is not yet over, there’s nothing like that going on now.” The first major collapse was investment bank Bear Stearns in 2008. It wasn’t an FDIC-insured institution but fulfilled many of the functions of a bank. It made loans, transacted securities and participated in Treasury bond auctions. Bear Stearns didn’t literally fail; it was bought as a going concern by JPMorgan Chase. To facilitate the sale, the Fed took control of $29 billion of “toxic assets.” At the time nobody was sure what those were worth; if they lost more than expected, the Fed would have taken the loss. That isn’t so different from how regulators took over First Republic, except it is the FDIC, not the Fed, sharing in the losses on First Republic’s residential and commercial loans to facilitate its sale to—once again— JPMorgan Chase. In the quarter before its failure, Bear Stearns had $395.4 billion in assets. Adjusted for inflation, that is $571 billion. By that metric, it exceeds the entirety of this year’s failures. It was only the beginning. Lehman Brothers—like Bear Stearns, not a commercial bank—unambiguously failed. On Sept. 15, 2008, Lehman filed what is still the largest bankruptcy in U.S. history, kicking off the worst weeks of the financial crisis. It declared $639 billion in assets in its filing. That is $886 billion in today’s dollars. Literally the next day, insurer American International Group was bailed out on the brink of failure. AIG was even larger: $1.05 trillion in assets. Adjusted for inflation that is $1.46 trillion. AIG wasn’t pushed into the arms of a financial institution. In exchange for loans ultimately totaling $182 billion, the New York Fed took 79.9% ownership and AIG was effectively nationalized. (Years later, after a lawsuit from AIG’s original shareholders, the Court of Federal Claims refused to award plaintiffs any damages, amusingly noting that “if the Government had done nothing, the shareholders would have been left with 100% of nothing.”) Also that September, the government placed mortgage giants Fannie Mae and Freddie Mac, with just under $900 billion in assets each, into conservatorship. Neither was a bank. Though privately owned, they were government-sponsored enterprises carrying the implicit backing of the Treasury. Washington Mutual’s very conventional bank failure occurred on Sept. 26, 2008. All of this was before the infamous Troubled Asset Relief Program became law in October 2008. TARP drew most of the attention as the symbol of bailout excess. Even outside of TARP, one of the biggest rescues was yet to come. The Treasury and FDIC agreed to guarantee a $306 billion portfolio of troubled Citigroup loans, effectively backstopping an institution with $2.05 trillion in assets ($2.8 trillion with an inflation adjustment). The financial crisis showed that when things get really bad there is a continuum of ways in which financial institutions can collapse. For those keeping tabs, the total assets of the major financial institutions in 2008 that collapsed or were saved with public support—Bear Stearns, Lehman, AIG, Washington Mutual, Citigroup— were $4.5 trillion at the time. Freddie and Fannie add a further $1.8 trillion. Adjusted for inflation, that is about $8.7 trillion today. This year’s failures are 6% of that sum. That doesn’t include TARP, the mortgages guaranteed by Fannie and Freddie, the last-minute acquisitions of Wachovia and Merrill Lynch, the conversion of Goldman Sachs and Morgan Stanley into bank holding companies, and many other emergency programs. The only way today’s situation will compare is if it gets much, much worse, said MIT’s Mr. Johnson—that is, “if we’re only now in the Bear Stearns stage” and experiencing the very first of many failures. For now we aren’t even close, and suggesting otherwise is an invitation to a panic that isn’t backed up by the numbers.