Fed Defies Transparency Aim in Refusal to Identify Bank Loans

Nov. 10 (Bloomberg) — The Federal Reserve is refusing to identify the recipients of almost $2 trillion of emergency loans from American taxpayers or the troubled assets the central bank is accepting as collateral.

Fed Chairman Ben S. Bernanke and Treasury Secretary Henry Paulson said in September they would comply with congressional demands for transparency in a $700 billion bailout of the banking system. Two months later, as the Fed lends far more than that in separate rescue programs that didn’t require approval by Congress, Americans have no idea where their money is going or what securities the banks are pledging in return.

“The collateral is not being adequately disclosed, and that’s a big problem,” said Dan Fuss, vice chairman of Boston- based Loomis Sayles & Co., where he co-manages $17 billion in bonds. “n a liquid market, this wouldn’t matter, but we’re not. The market is very nervous and very thin.”

Bloomberg News has requested details of the Fed lending under the U.S. Freedom of Information Act and filed a federal lawsuit Nov. 7 seeking to force disclosure.

The full article includes more Fed lies, Barney Frank hot air, and some info on the AIG bailout.

http://www.reuters.com/…

Troubled insurer American International Group Inc had borrowed $90.3 billion from the U.S. government as of Wednesday, three-quarters of the emergency funds made available to it under a federal rescue plan, the Wall Street Journal reported.

AIG, once the world’s largest insurer before it was hammered by bad bets on mortgages, borrowed a further $7.4 billion from a government loan facility in the last week, the paper said on its website.

The move marked the first time the insurer had borrowed more than the government’s original $85 billion rescue loan, announced on September 16.

Earlier this month, the government gave AIG nearly $38 billion more in fresh cash.

On Thursday, AIG Chief Executive Edward Liddy warned that the $120 billion-plus in emergency federal cash extended to the insurer may not be enough.

Obviously, AIG is perfectly stable.

There was a lot more wrong with what happened in the Great Depression. Mr. Rogers should know that and should have mentioned that. To act as if liquidity alone was the reason for the Great Depression is disingenuous.

From the email I just received:

On the day following the 221st anniversary of the signing of the U.S. Constitution, WTP Chairman and constitutional activist Robert Schulz today filed a federal lawsuit in United States District Court in Albany seeking to halt the execution of the emergency bailout of American International Group, Inc. (AIG) by the United States Government and the Federal Reserve.

The lawsuit asserts that the commitment of public funds and credit for the direct benefit of privately owned AIG is an ultra vires action by the United States Government and Federal Reserve, i.e., beyond the limited legal authority granted by the Constitution. The lawsuit asks for a “show cause” hearing demanding that the Government produce evidence of its legal authority to commit public funds for such a purpose, as well as emergency and permanent injunctions halting the bailout transaction.

Beyond the Constitutional deficiencies, the bailout establishes a dangerous precedent enabling the Fed and/or Government to nationalize virtually any business or property within the United States without legal authority or congressional approval.

The defendants include the Federal Reserve System, Fed Chairman Ben Bernanki, the U.S. Treasury, Treasury Secretary Hank Paulson Jr. and the United States Government.

The WTP Foundation today issued a press release citing Schulz:

“Beyond the moral hazard and dangerous precedent established by this action, it is of vital importance that the American people recognize that the present financial crisis is a direct and predictable result of decades of constitutional violations by the Federal  Government.  Through a long-standing policy of disinformation and collusion with the Federal Reserve and Wall Street financial elite, the United States Federal Government has denied public access to information about the secretive operations of the privately owned and operated Federal Reserve and its monopoly control of America’s money system.

“This monopoly control of our currency by a private banking cartel has resulted in increasing distortion, volatility and cyclical (boom and bust) economic conditions in the U.S. and abroad.  America’s fiat currency (produced from thin air) is manipulated by the Federal Reserve for the benefit of its owners, major Wall Street financial institutions and the Federal Government and is not unaccountable to the taxpayers. These abuses of the Constitution have taken our financial system to edge of the abyss. The chickens have come home to roost.”  Click here to read the Complaint, the Memorandum of Law supporting the TRO, and Schulz’s Declaration which includes several recent articles from the New York Times.

As the announcer from Smash TV once said: Good luck! You’ll need it!

This won’t get anywhere but it’s nice to see someone is trying.

Reid may not know what to do… but Paul does. Too bad no one listens.