Supreme Court: Fed Must Discharge Discount Window Information To Press
The Supreme Court has ordered the Federal Reserve to give up more information about the Wall Street bailout. The Supreme Court on Monday sided with a reporter from Bloomberg News who sued to force the Fed to expose the Wall Street banks that borrowed emergency money from a lending program called the “discount window”. Monday’s Supreme Court ruling adds discount window information to details about six other bank bailout programs Congress required the Fed to disclose in Dec.
Getting the discount window open
The discount window information was not disclosed as part of the $3.5 trillion Wall Street bank bailout details of 2008 that the Fed reveled as part of the Dodd-Fran financial reform bill. Bloomberg decided to use the Freedom of Details Act to file a request to get information about the discount window from 2008. The Fed wouldn’t do it though. The Fed appealed after Bloomberg won the trial court. This occurred in 2009. About 10 percent of the largest United States banks are represented by the Clearing House Association. After the ruling was upheld in appeals court, the Association filed another appeal. The Fed has to give information within five days after a Supreme Court decision on Monday upheld the ruling more. It is the first time the Fed will release confidential information about the discount window since the program started in 1913.
The discount window to consider
During the financial crisis, the Fed reduced the discount rate, lowered the primary credit rate and extended the maximum term from overnight to ninety days in the discount window. Any documents from April to May 2008 have to be released. This consists of banks and amounts borrowed. As the financial services industry trumpets its government-backed return to profitability for investors, the discount window data could embarrass some of the biggest Wall Street banks. When bailing out the Wall Street banks, the public will know how much the government really put into it. This may have a bad effect for banks as well as the leaders of these banks.
Wall Street will always win
Wall Street seemed really interested in keeping the discount windows between April and May 2008 a secret, which many wonder about. In accordance with the Clearing House Association, it would be really hard on banks for this information to be released. This is because banks may not feel comfortable borrowing in the future when needed. However even though the Supreme Court upheld Bloomberg’s case, Wall Street lawyers managed to delay the release of discount window data for more than two years. The Fed is needed to discharge information on financial loans because of the Dodd-Frank financial reform bill after a two year grace period. This is for any loan made after July 21, 2010.
Articles cited
Wall Street journal
online.wsj.com/article/SB123664681664078731.html
Toronto Star
thestar.com/sports/article/953953–march-madness-a-massive-opportunity-for-players-and-advertisers
MSNBC
money.msn.com/saving-money/article.aspx?post=87aa1afb-e29c-41ce-ac80-49cae0cc9a60
Media Life
medialifemagazine.com/artman2/publish/Sports_TV_52/Why-March-Madness-is-so-hot-this-year-.asp
