Bloomberg Sued the Fed Reserve

Bloomberg Sues Fed to Force Disclosure of CollateralBy Mark Pittman

Nov. 7 (Bloomberg) -- Bloomberg News asked a U.S. court today to force the Federal Reserve to disclose securities the central bank is accepting on behalf of American taxpayers as collateral for $1.5 trillion of loans to banks.

The lawsuit is based on the U.S. Freedom of Information Act, which requires federal agencies to make government documents available to the press and the public [emphasis mine], according to the complaint. The suit, filed in New York, doesn't seek money damages.

``The American taxpayer is entitled to know the risks, costs and methodology associated with the unprecedented government bailout of the U.S. financial industry,'' said Matthew Winkler, the editor-in-chief of Bloomberg News, a unit of New York-based Bloomberg LP, in an e-mail.

The Fed has lent $1.5 trillion to banks, including Citigroup Inc. and Goldman Sachs Group Inc., through programs such as its discount window, the Primary Dealer Credit Facility and the Term Securities Lending Facility. Collateral is an asset pledged to a lender in the event that a loan payment isn't made.

The Fed made the loans under 11 programs in response to the biggest financial crisis since the Great Depression. The total doesn't include an additional $700 billion approved by Congress in a bailout package.

The problem I see is that the Fed is a privately held company/corporation and hence would be excluded in the"federal agencies" category. The Federal Reserve is really nothing but a private company which has been given the monopoly to print US dollars by the government.

I would like to see Bloomberg win this action, and even more to see the Fed abolished (which is quite likely, just a couple of years or so down the road, when hyper inflation destroys the USD or when/if the Amero is created).