Mark Pittman, Bob Ivry and Alison Fitzgerald, Bloomberg News, November 10, 2008
"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....
"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."
Lawmakers, Investors Ask Fed for Lending Disclosure, Bloomberg News, November 13
Mike Meyers, Minneapolis Star-Tribune, November 2, 2008
"The nation indeed may be facing a financial crisis, with large institutions failing in the wake of multibillion debts, but most bank-lending to business customers actually has been on the rise....
"'The story goes that they [banks] are holding on to the money or putting it into Treasury bills,' said Lawrence Christiano, a Northwestern University economist and consultant to the Federal Reserve Bank of Minneapolis. 'That seems to fly directly into the face of the evidence that's out there.'
"It's a puzzle that's getting little attention, even as hundreds of billions of taxpayer dollars are devoted to fixing a problem that seems belied by government figures. 'Their own data seems to contradict their position,' said V.V. Chari. 'It would be valuable for them to explain what they're talking about.'
"The $700 billion taxpayer bailout of large players in the financial system reminds Chari of the buildup to the Iraq war. 'The analogies with the war in Iraq are more than disturbing,' Chari said. 'We're again hearing things like: "We know things you don't know. Trust us."