The Washington Post reports:
Following a long-standing practice designed to protect investor and depositor confidence in the institutions it deals with, the Fed refuses to name the banks and other companies accessing the cash. It has also declined to specify which assets institutions have pledged as collateral in exchange for loans, a decision that has drawn skeptical questioning from Capitol Hill and at least one lawsuit under the Freedom of Information Act. Fed officials argue that any disclosure along those lines would create a stigma for banks and others that need to borrow from the Fed, making the programs less effective at jump-starting lending.and
"There's a concern that if the name is put in the newspaper that such and such bank came to the Fed to borrow overnight for a good reason, that people might begin to worry: Is this bank credit-worthy?" Fed Chairman Ben S. Bernanke told Congress last week. "And that might create a stigma, a problem, and might cause banks to be unwilling to borrow."
The Fed has consistently rejected requests to disclose more information about which assets it is taking as collateral for its lending programs. Bloomberg News sued under the Freedom of Information Act this month, requesting the information; the Fed refused, responding that the information was protected because it is confidential commercial information, and because it is being kept by the Federal Reserve Bank of New York, which it argues is not subject to FOIA.How many people know that the people that work at the Fed aren't government workers? Secrecy and creeping socialism.
