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Bloomberg suing Fed to find out who’s getting the bailout cash

Financial news organisation Bloomberg has requested the details of who the US Federal Reserve is lending its trillion dollar bailout cash to under the Freedom of Information Act, as well as suing the Fed in a bid to force disclosure.

While Fed chairman Ben Bernanke and Treasury Secretary Hank Paulson said in September they’d comply with congressional demands for transparency, to date they have refused to name a single company to receive some of the trillion dollars they have dispersed thus far.

Federal Reserve spokeswoman Michelle Smith wouldn’t comment to Bloomberg on the lawsuit or the loans.

“The collateral is not being adequately disclosed, and that's a big problem. In a liquid market, this wouldn't matter, but we're not. The market is very nervous and very thin”, vice chairman of Loomis Sayles & Co. Dan Fuss told Bloomberg.

Bloomberg argues the Fed's lending is significant because it stepped into a rescue role that was also the purpose of the $700 billion Troubled Asset Relief Program, or TARP, bailout plan – but without safeguards put into the TARP legislation by Congress.

Bloomberg reports total Fed lending topped $2 trillion for the first time last week and has risen by 140%, or $1.172 trillion, in the seven weeks since Fed governors relaxed the collateral standards on September 14.

The difference includes a $788 billion increase in loans to banks through the Fed and $474 billion in other lending, mostly through the central bank's purchase of Fannie Mae and Freddie Mac bonds.
New Zealand’s annual GDP is roughly $US120 billion.

The reason for the lack of transparency appears to be Wall St Banks, who oppose releasing information because it might signal weakness and spur a run by depositors or short-selling.

Citigroup, Bank of America Corp., JPMorgan Chase, Wells Fargo & Co., Goldman Sachs Group Inc. and Morgan Stanley – America’s biggest banks – would not comment on whether they have borrowed from the Fed.

The Bloomberg lawsuit is Bloomberg LP v. Board of Governors of the Federal Reserve System, U.S. District Court, Southern District of New York (Manhattan).

More by by Mitchell Hall

Comments and questions
19

Where are the upset millions of citizens, watching our treasure be plundered?

Where are the upset citizens? We are truly many more than the government that is stealing from us.

There is strength in numbers!

Kate is completely right and the ultra elites that have stolen our Democracy know this. Enough is enough already the time has come for us as American citizens to band together, get organized, and secure our childrens future. We can no longer trust our corrupted political parties, they serve the lobbyists and the rich elite that rule our lives. If anyone else is serious and would like to help me form an organizaqtion of the people lets get started. We must be peacful in restoring Democracy violence is not the answer. With the strength of numbers we the people of the United States of America can make our voices heard and remove every single corrupt politician in office. Unless we all take action and stand up we will continue to see the greatest transfer of wealth in history as we find it harder and harder just to get by, feed our families, and get the much needed health care we all deserve. Our country as it stands now is no longer a Democracy, we have lost so many of our rights through corruption. Our founding fathers would no longer recognize this country as it stands now. America is now a Country "By the Rich For The Rich"

we the people- we need a 3rd political party, we are not represented, the federal reserve is the first entity that needs to be seized and run by, we the people. why has it been independent and omnipotent?, why hasnt any elected official enacted legislation to make it come under the control of we the people? it is evident we are pawns and we cant wait one day longer for change, barack will not do it.

Would someone (union, ACLU, anyone) please start suing CEO's of these corporations receiving our free money? Their bonuses should be taken away to pay for some of this. Somebody should go to jail, start
with CEO's than go up the chain to fed. reserve. No one is accountable for anything nowadays unless you are a common folk. Than you'll go to jail for lifting a candy from local store.

They are sitting in their living rooms watching Entertainment Tonight, eating pizza and waiting for Obama to do something.....

the bailout is just another manufactured way to bilk the us citizen out of their childrens futures.

...and we wouldnt want to embarrass anyone by outting them as an entity that was in fact given bailout money...

rediculous i tell you!! i say we all just stop paying taxes until we are shown where this money is going.

Stop paying YOUR taxes and see how far that gets you. They know we are too busy working and trying to take care of our families to fight them. We're just a bunch of peasants working to make the rich richer and they know it. There's nothing we can do. America is finished.

By God people, just stop paying your taxes now!

It's so far gone now. Anyone can see we are not be fairly represented. What would you rather do? Take to the streets in protest? I say cut off the flow of funds to the corrupt government is the better and more humane thing to do. Protesters are always labelled as an unruly bunch.

When you file your taxes, make sure to photocopy your bum so they'll know who wrote them: an angry bunghole!

Why can't the Fed just play nice and give the information out to the public as it should be. why hid all the details?? are you trying to con the american middle class? All i see is home prices going down and down and down with no end in site. Many other americans see the same results as I according to this survey i found at:

http://www.homepricetrend.com

This is just rediculous!!

Why can't the Fed just play nice and give the information out to the public as it should be. why hid all the details?? are you trying to con the american middle class? All i see is home prices going down and down and down with no end in site. Many other americans see the same results as I according to this survey i found at:

http://www.homepricetrend.com

This is just rediculous!!

theyre really fighting over whos entitled to more of the money, they dont want to reveal the details of it, because commonsense will tell even the under graduates of graduates, who WONT be recieving any plus who WILL be loosing their lot as well.
Thats when we'll see the very bottom of this global crunch.

here I am!!ive been here for years! Im waiting for the others to catch up!!! yes! we need to do something! BUT WHAT?????

LET S SEND SOME MONEY TO BLOOMBERG TO SHOW OUR SUPPORT

Cartels are bad for business. Do you understand why the FED is being sued in court versus why the FOIA is not be enacted? This is a direct theft from savers via engienered inflation. "Printing" 20%-25% of the national GDP in one year simply means the dollar will fall 20%-25% year over year. Your house *might* go up 25% but your pay will not! Food and other consumable surely will track the money printing. Nationalize the Central Bank!?! Return to the gold standard. We are in an 8 year recession when you chart DOW/gold ratio.

Nice move Bloomberg, just do it. This is the way. No more street fights. The big problem, the MAIN problem was not the bunch of rich guys, abusing the system, but the COURT itself, the police, the congressmen. If all they did their work, nothing like this could happen. Or as someone used to say, there is no bad law....Think about.

Buy Low = Fed purchase of assets @ Low, which is now!
Sell High = 4-6 years from now when assets are higher!

Bloomberg deserves an award for suing Fed to find out who’s getting the trillion dollar bailout cash.

If our government is seeking to rebuild confidence and faith in our economy and our government, then hiding information from the public is not the way to restore confidence and trust.

The government doesn't trust us as they are afraid we will vote our displeasure by leaving investments that are managed by incompetent boobs.

Take, for example, the FDIC. They won't tell you the banks that are on their watch list. They are afraid we will take out the money from ineptly managed banks, which is our choice. Why should we prop up banks with poor managers? There are so many other strong banks out there for depositors, so let the 117 banks fail. The stronger banks deserve the deposits these poorly managed banks hold.

Talking about trust in our government again, why is it that any depositor in American banks has to lose money? The FDIC has an arbitrary cap at $100,000 per depositor which was raised to $250,000 to the end of 2009. Why have a cap if you really, really want to have depositors maintain trust in the government and the economy?

Germany has no caps on their depositors' funds. Why can't we have our government and FDIC do the same? It seems to me that to rebuild trust, faith, and confidence in our economy and government, our government needs to support the depositors, no matter what level of deposit.

Why should we prop up banks or other financial institutions that are managed by poor managers? There are so many other strong banks and institutions out there seeking customers, so let the 117 banks fail. The stronger banks deserve the deposits these poorly managed banks hold. The ineptly managed banks are holding hostage ALL of the banking industry because depositors don’t know if their bank is on the list. So, ALL banks suffer because of the few rotten banks.

Bloomberg is to be commended for having the foresight, courage, and commitment to sue the FED to put out INFORMATION THAT SHOULD NEVER HAVE BEEN HIDDEN.

Lee Ellak
San Jose, CA

This is the best way, cheat like the politicians do

Screw them, my customers are now asking how would you like to be paid??

Green backs and you'll save 10% on the invoice amount

F*&K em