Bailed Out Banks To Be Disclosed By Fed Reserve = Apocalypse

Postby Tama on Tue 1/Sep/09 3:31pm

...apparently...

...any hoo - as I'm at home today and it's raining I've been trawling the interwebs for fun and games (and mainly George Carlin videos) and I came across this interesting piece of news:

http://www.bloomberg.com/apps/news?pid= ... CC61ZsieV4 wrote:The Federal Reserve must for the first time identify the companies in its emergency lending programs after losing a Freedom of Information Act lawsuit.

Manhattan Chief U.S. District Judge Loretta Preska ruled against the central bank yesterday, rejecting the argument that loan records aren’t covered by the law because their disclosure would harm borrowers’ competitive positions.

The Fed has refused to name the financial firms it lent to or disclose the amounts or the assets put up as collateral under 11 programs, most put in place during the deepest financial crisis since the Great Depression, saying that doing so might set off a run by depositors and unsettle shareholders. Bloomberg LP, the New York-based company majority-owned by Mayor Michael Bloomberg, sued on Nov. 7 on behalf of its Bloomberg News unit.


To summarise what this means is the Federal Reserve has to identify the companies to whom it gave the $1.5 trillion dollars in taxpayers money and it has to list the assets used as collateral for the so-called "loans." Something the Federal Reserve didn't want to do for some reason...

All of which sounds pretty fair as it is after all it is taxpayers money and if I was a U.S. taxpayer I'd be pretty interested where my share went to. But if you read the Bloomberg article you're see this "The Fed has refused to name the financial firms it lent to or disclose the amounts or the assets put up as collateral under 11 programs, most put in place during the deepest financial crisis since the Great Depression, saying that doing so might set off a run by depositors and unsettle shareholders."

So, taxpayers are expected to pay trillions of dollars to banks who're in the poo - but they shouldn't know which banks have received their money because that information might unsettle the bank's shareholders or cause a FINANCIAL APOCALYPSE (ooohhh)...

In fact in the court case the following was put forward by "The Clearing House Assocation" who are ABN Amro, Bank Of America, The Bank Of New York, Deutsche Bank, HSBC, JP Morgan Chase, US Bank and Wells Fargo.

A bunch of really big banks wrote:The Clearing House submits this declaration because the Court's Order threatens to impair the ability of our members to access emergency funds through the New York Fed's Discount Window without suffering the severe competitive harm that public disclosure of their identity will cause.

Our members have accessed the New York Fed's Discount Window with the understanding that the Fed will not publicly disclose information about their borrowing, especially their identity. Industry experience, including very recent and searing experience, has shown that negative rumors about a bank's financial condition - even completely unfounded rumors - have caused competitive harm, including bank runs and failures.


:blink:

...obviously transparency is a very bad thing. We should all remember that when a bank next asks us about our credit history.


Any hoo - I'm curious to see how this plays out.
Tama
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Re: Bailed Out Banks To Be Disclosed By Fed Reserve = Apocalypse

Postby RJD on Tue 1/Sep/09 3:36pm

Oh joy just as things were settling down...

Honestly if the companies/banks needed this money then its probabl best if you dont have your own money in them, but then that will kill them quickly..
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Re: Bailed Out Banks To Be Disclosed By Fed Reserve = Apocalypse

Postby E Dogg Capizzle on Tue 1/Sep/09 3:39pm

You know, it's hard to care about this. I think it's pretty clear now that the calls of a financial apocalypse last year were wildly exaggerated. :)
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Re: Bailed Out Banks To Be Disclosed By Fed Reserve = Apocalypse

Postby RussS on Tue 1/Sep/09 3:53pm

At least you were watching some classy videos with the Class Clown :)
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Re: Bailed Out Banks To Be Disclosed By Fed Reserve = Apocalypse

Postby j2hyde on Tue 1/Sep/09 6:52pm

Tama wrote:...obviously transparency is a very bad thing. We should all remember that when a bank next asks us about our credit history


Too much transparency caused last years financial meltdown. Somebody noticed the emperor was wearing no clothes.
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Re: Bailed Out Banks To Be Disclosed By Fed Reserve = Apocalypse

Postby happybaboon on Tue 1/Sep/09 6:55pm

My word what a dull sort of apocalypse this will be. I had always hoped it would have zombies, or at very least nuclear war.
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Re: Bailed Out Banks To Be Disclosed By Fed Reserve = Apocalypse

Postby j2hyde on Tue 1/Sep/09 7:04pm

But rich people temporally loosing a small fraction of their wealth is much worse than zombies. I feel sorry for them :(
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Re: Bailed Out Banks To Be Disclosed By Fed Reserve = Apocalypse

Postby Tama on Wed 2/Sep/09 8:24am

E Dogg Capizzle wrote:You know, it's hard to care about this. I think it's pretty clear now that the calls of a financial apocalypse last year were wildly exaggerated. :)

I'm not worried by this - I'm pretty sure this sort of news has been burbling away in the background for the past year or so - we just got bored with it.

But to put this into perspective this would be like the Reserve Bank handing out $NZ30 billion to ANZ, ASB, BNZ etc. etc. to prop them up - and then refusing to say who got how much. Crazy shit.
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Re: Bailed Out Banks To Be Disclosed By Fed Reserve = Apocalypse

Postby thorg on Wed 2/Sep/09 8:29am

E Dogg Capizzle wrote:You know, it's hard to care about this. I think it's pretty clear now that the calls of a financial apocalypse last year were wildly exaggerated. :)
Pretty sure I read somewhere that what we REALLY have to worry about is wind turbines. They are messing with the earths inner energy flow (chi or was it qi?), and once that happens, well, the whole earth will crumble. Apparently mother earth doesnt like her qi blocked.
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Re: Bailed Out Banks To Be Disclosed By Fed Reserve = Apocalypse

Postby E Dogg Capizzle on Wed 2/Sep/09 8:56am

thorg wrote:
E Dogg Capizzle wrote:You know, it's hard to care about this. I think it's pretty clear now that the calls of a financial apocalypse last year were wildly exaggerated. :)
Pretty sure I read somewhere that what we REALLY have to worry about is wind turbines. They are messing with the earths inner energy flow (chi or was it qi?), and once that happens, well, the whole earth will crumble. Apparently mother earth doesnt like her qi blocked.


I've decided to allocate my worrying to the plight of South Island snails. Poor little buggers. :(
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Re: Bailed Out Banks To Be Disclosed By Fed Reserve = Apocalypse

Postby Tama on Wed 2/Sep/09 8:59am

E Dogg Capizzle wrote:
thorg wrote:
E Dogg Capizzle wrote:You know, it's hard to care about this. I think it's pretty clear now that the calls of a financial apocalypse last year were wildly exaggerated. :)
Pretty sure I read somewhere that what we REALLY have to worry about is wind turbines. They are messing with the earths inner energy flow (chi or was it qi?), and once that happens, well, the whole earth will crumble. Apparently mother earth doesnt like her qi blocked.


I've decided to allocate my worrying to the plight of South Island snails. Poor little buggers. :(

But you're robbing people like j2hyde of paid employment as a professional snail killer.

DON'T YOU CARE ABOUT THE ECONOMY :ib: :hmmm:
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Re: Bailed Out Banks To Be Disclosed By Fed Reserve = Apocalypse

Postby iodi on Wed 2/Sep/09 9:24am

One reason why the Fed doesn't want to disclose which banks got the support money is that disclosure might scare the punters, leading to a run on some of the banks. If banks collapsed, then it is the Fed that would have to compensate depositers via the Federal Deposit Insurance Corporation (which guarantees bank deposits) - and the Fed aint't got no more money. Of course, the banks' shareholders would also get screwed over in a collapse, but no one cares about them.
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