Fed Weighs Naming Borrowers

WSJ ^ | 26 Sep 2009 | SUDEEP REDDY

[BGHater]

The Federal Reserve, under pressure from Congress to be more transparent,is "giving serious consideration" to releasing the names of firms that receive loans from the central bank, a top Fed official said Friday.

At a House hearing,Fed General Counsel Scott Alvarez struck a conciliatory tone when a top lawmaker indicated that he wanted more information revealed about the Fed's loans.

Rep. Barney Frank(D., Mass.),chairman of the House Financial Services Committee,said the central bank's loans and securities transactions should be disclosed, with a lag to avoid a short-term influence on financial markets. He said he wanted to include a provision to do so in coming legislation.

"You don't have a right to go to a federal agency, borrow money [and] keep it secret forever," Mr.Frank said of financial institutions.

"We don't want public entities buying and selling securities with nobody ever knowing," he said. "We want there to be publicity.We don't want there to be a market effect in the near term."

The Fed has long resisted identifying borrowers from its regular lending programs -- such as the discount window, which provides short-term loans to banks--fearing disclosure could discourage use of the programs by firms that need support.

But the central bank,after drawing attention for its rescues of American International Group and Bear Stearns, is trying to respond to lawmakers who want a more comprehensive accounting of who receives the Fed's money and under what conditions.

Asked if the Fed would work with Congress on establishing provisions for disclosure, Mr. Alvarez said, "We'd be happy to work with you on it."

The hearing addressed the implications of a bill from Rep. Ron Paul (R., Texas) that would open more of the central bank's operations to audits by the Government Accountability Office, the investigative arm of Congress.

[jiggyboy]

"giving serious consideration" to releasing the names of firms that receive loans

Looks like Bernanke has hired the same speechwriter that the nutjob running Iran uses. Which do we see first on CNN, Bernanke reading this list of banks or Nutjob going over a map of Iran's nuke labs.

[cripplecreek]

Why don’t they just make them an offer they can’t refuse. Sheesh these clowns are pathetic.

[Candor7]

I want to see the list of those institutions that created the electronic bank run ( 500 billion plus) last Sept 17th, which was used by Bernecke to grift our government.

This transparancy request is small change by comparison.

[cripplecreek]

This is kind of a stupid threat for the Fed to make. If we get the audit we want, we’ll know the names anyway.

[Candor7]

Audit HO!!!!!!

Soros and a group of ME banks were likely behind the run.

Love to see THAT list of names.

There IS a reason why Obama bowed and licked the hand of the King of Saud.