Wednesday, November 12, 2008
Fed won't account for $2 Trillion of Bailout
Fed Defies Transparency Aim in Refusal to Disclose
By Mark Pittman, Bob Ivry and Alison Fitzgerald
Nov. 10 (Bloomberg)
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.
$ and this from The Bailout Sleuth $
A change in plans
By Chris Carey on November 12, 2008 3:54 PM
Treasury Secretary Henry M. Paulson Jr. confirmed Wednesday what was already becoming apparent -- that the government will not use any of its $700 billion financial-industry bailout fund to buy toxic assets from banks and other institutions.
Those purchases were the basis of the Troubled Asset Relief Program that Congress approved last month. The argument was that removing distressed assets such as mortgage-backed securities from the books of those companies would ease fears about their solvency, free up capital, encourage lending between companies and thaw a frozen credit market.