Thursday, December 11, 2008
Congressman: Fed "Bamboozling" Americans
The Fed is refusing to disclose the recipients of $2 trillion dollars in loans, even after Bloomberg sued under the Freedom of Information Act to get the information.
As Bloomberg writes:
“If they told us what they held, we would know the potential losses that the government may take and that’s what they don’t want us to know,” said Carlos Mendez, who oversees about $14 billion at New York-based ICP Capital LLC.***
Congress is demanding more transparency from the Fed and Treasury on the bailout efforts, most recently during Dec. 10 hearings by the House Financial Services committee when Representative David Scott, a Georgia Democrat, said Americans had “been bamboozled.”***
“Americans don’t want to get blindsided anymore,” Mendez said in an interview. “They don’t want it sugarcoated or whitewashed. They want the complete truth. The truth is we can’t take all the pain right now.”
The Bloomberg lawsuit said that the collateral lists “are central to understanding and assessing the government’s response to the most cataclysmic financial crisis in America since the Great Depression.”
In response, the Fed argued that the trade-secret [law] could be expanded to include potential harm to any of the central bank’s customers . . . .
Trade secret law?
Trade secret law protects things like valuable business methods. What's the banks' secret business method here - making stupid decisions, going bankrupt and then becoming the recipient of socialist government handouts?
What's next? Will the government argue that it can't disclose the details of its torture program because it needs to protect the trade secrets of the companies that make the electro-shock machines and the waterboarding platforms?
5 comments:
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What's next? Fed will become automatic bailout machine. Why go to congress when you can go to the Fed?
ReplyDeleteGEEEZE- George don't give them any ideas. They probably hadn't thought about that route to torture protection.
ReplyDeleteIt's public debt, and it's not a matter of national security (too often used as an excuse), so collateral postings should be transparent. The only scenario in which hiding the truth doesn't come back to bite us in the collective arse, is if the Fed gets the majority of its debt repaid back in a timely fashion... any takers on that possibility? Regarding the collateral, what would I do is if I was a bank... unload on the Fed all the crap I could. Bill
ReplyDeleteWhat all this is leading to is a collapse of the currency. The Federal Reserve note (which is not backed by anything but a printing press) is going to lose most (if not all) of its purchasing power before this show is over.
ReplyDeleteThe whole financial "crisis" is really just the end result of years of a binge of spending on consumption that was financed by foreign debt. Now that is it becoming obvious that the debts can't be repaid, the whole house of cards is collapsing.
The Fedaral Reserve Bank is a private corporation. They don't have to comply with any Freedom of Information Act requests. Those requests are for government agencies.
ReplyDeleteJust about anything that the Fed does can be protected as a trade secret.