|From a Senate Banking committee hearing today:
Meanwhile, senators as right-leaning as John Ensign (R-NV) and as left-leaning as Bernie Sanders (I-VT) have pushed the Fed today to be more transparent in disclosing which entities are receiving TALF loans. "I think it's a good idea to ... say to the Federal Reserve, 'Let's see what you are actually doing in the marketplace,'" Ensign told reporters today, "because the American people who are the ones who are on the hook."
In the House, the Financial Services committee used this broad, bi-partisan anger to extract a slightly increased promise of transparency from the Fed:
Federal Reserve Chairman Ben S. Bernanke initiated a review of the information it provides the public after lawmakers criticized the central bank's disclosure policies during the unprecedented expansion of its holdings.
"We at the Fed have begun a thorough review of our disclosure policies and the effectiveness of our communication," Bernanke said today in remarks prepared for testimony before the House Financial Services Committee. Board Vice Chairman Donald Kohn will lead a panel for the review(...)
The Kohn panel will have a "presumption" that the public has a right to know and that "nondisclosure of information must be affirmatively justified by clearly articulated criteria for confidentiality," Bernanke said.
Bernanke also said the Fed is preparing a Web site where the public can find more details and analysis about the Fed lending effort.
This is "something," but it is still not nearly enough. The review in internal, conducted by a Federal Reserve board member. Further, there is an escape clause. So really, this new transparency isn't much of anything at all.
No. Here is a better example of the sort of transparency we need:
Send in the examiners. Yeah, I know, you're talking about "stress tests". Uh huh. Let's have those examinations now and forevermore in the future be public information. If a bank wants to operate under our laws and have the privilege of fractional reserve banking, they can open their books and examinations at all times to the public. Period.
This year, the Federal Reserve will surpass the United States Federal Government as the largest institution in the world, at least in terms of monetary expenditures. If, in order to please moderates, we have to sacrifice school construction and flu prevention while banks get another $1.5 trillion, we have the f**king right to know where, and how, that money is being spend.