The Financial Bailout Fiasco

Federal Reserve Map On top of the 700 Billion Bailout approved by Congress the Fed has loaned 2 Trillion lately to banks and financial institutions through 8 programs created in the last 15 months and 3 older programs.

"Barney Frank, House Financial Services Committee Chairman, supports the Fed's lack of transparency. The Congressman claims that disclosure would "give people clues to what your pricing is and what they might be able to sell us and what your estimates are.'' In September of 2003, Frank also stated, ''These two entities -- Fannie Mae and Freddie Mac -- are not facing any kind of financial crisis,'' This statement has proven to be false. " -Sherri Reese- http://www.digitaljournal.com/article/262177

- 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. ``In 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.

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http://www.bloomberg.com/apps/news?pid=20601087&sid=aatlky_cH.tY&refer=w...