Fed Official Confronted Over Bailout Spending Secrecy (VIDEO)

Where's the bailout money going? If the federal government told you, then banks might stop taking it.

That's the argument made by Federal Reserve Vice Chairman Donald Kohn in this overlooked clip from Tuesday's House Financial Services Committee hearing on the bailout funds.

In response to pointed questioning from Rep. Alan Grayson (D-Fla.), Kohn laid out the reasoning.

"I'd be very concerned, Congressman, that if we published the individual names of who was borrowing from us, no one would borrow from us," he said. "The purpose of our borrowing is not to support individual institutions but to support the credit market."

Grayson couldn't believe it. "Has that ever happened? Have people ever said we won't take your $150 billion because people might find out about it?" he asked.

Watch Grayson v. Kohn:

Comments

[Chlowina]

Feeling the need for a cigarette after reading this one.

[PhilipTaylor]

It is time for the FED to be brought under con_trol of the US GOV_ERNMENT!

Our gov_ernment is hem_orrhaging from le_aks in our DISH_ONEST ACCO_UNTING SYSTEMS IN OUR COR_RUPT BU_SH/CHE_­NEY/PAU_LS­ON GOV_ERNMENT!

This makes En_ron and Art_hur And_erson look like CHILD'S PLAY!

[PhilipTaylor]

It is time for the FED to be brought under control of the US GOVERNMENT!

Our government is hemorrhaging from leaks in our DISHONEST ACCOUNTING SYSTEMS IN OUR CORRUPT BUSH/CHENEY/PAULSON GOVERNMENT!

This makes Enron and Arthur Anderson look like CHILD'S PLAY!

[mjc]

Think that we are being played like fiddle by the Feds, as if we were watching some sort of shell game. Tramsparency is a myth in their book. No one except the initiates are allowed to know who got what.....they don't want their names mentioned, nor how much they asked for....!!!! Looks like we're protecting the value of the dollar and the world wide corporate greed that seems to have taken hold. The champion of that greed is Hank Paulson. All this talk about help to relax the credit markets is just another way to hold out your hand and say, please.......?

[tobyjack]

Donald Kohn is lying through his teeth. Let's waterboard him until he tells the truth.

[ernstge]

The money mainly went to the CEOs as bonuses and salaries. It's OK because it isn't money anyhow. You won't find out until the new admin comes into power next week. Doesn't matter if it's $millions, $billions or $trillions. It's only paper or ones and zeroes on a computer. Take a $20 out of your pocket and look at it. Nowhere does it say it is money. It says very plainly at the top FEDERAL RESERVE NOTE. In otherwords all it really means is you the taxpayer have accepted a loan from the Fed. It also says you can trade it as it is "GOOD FOR ALL DEBTS, PUBLIC AND PRIVATE". Try to take this note to the bank and exchange it for "money". All you will get is two tens or four 5s that say the same thing. The public doesn't understand there is no money. If companies kept books like banks, they would be arrested. Walk into a bank someday and look at it's published conditions. Lots of assets and little debt. Do you know why? Assets are outstanding loans they hope to collect. The liabilities are the depositors money. They may have to pay that back someday. Only when the loans start to fail and have to be "written off" is there are problem. If the bank's loan portfolio drops below the money put in by depositors, the bank becomes insolvent. The house of cards collapses. That's what the mortgage debt problems are really about.

[LyleJay57]

Barney Frank and his collegues on this committee are bumbling oafs who allowed the banks and Wall street firms to steal taxpayer money to the tune of billion$. They are all on the take. NOW they get around to asking tough questions, but it is all for show. They have zero credibility. Kohn is full of it, too. The credit markets have not loosened up.

[maserati2]

Why is the response of the American taxpayer toward the Bailouts so passive and polite?

Where is the ANGER? Where is the call to MARCH ON WASHINGTON?

America’s finances suddenly became a crisis when the Republican Right realized that the McCain presidential campaign was failing and they were about to lose control of Washington and the National Treasury.

Paulson insisted on immediate, total control of a huge “emergency” account to save the economy, but the true intention was to build corporate and personal wealth, fund CEO retirement accounts and buy distressed properties at discount, NOT to protect our national economy.

We were told when the bailout was approved that government oversight would protect our grandchildren’s futures. That never happened. Once the bill was signed, all promises were forgotten. Even as attempts by the Big 3 and frantic taxpayers for financial assistance were met with ridicule and outright refusal from the very organizations funded to help them, blank checks to Wall Street continued without questioning or control.

Why do we not demand now, before those funds are drained completely dry, that Paulson, his cronies and Congress be forced if necessary to account for every “emergency” dollar? Shall we allow our economy to die so a privileged group can prosper? Do we not care?

[goldcoastsailor]

This shithead works for us?

[ReasonIsMyReligion]

Kohn's answer is baloney:

If you received the money were disclosed, their stock value might drop.

"SO?"

Better the Fed perpetuate a gauzy illuision that the banks are not differentially incompetent?

[ReasonIsMyReligion]

P-O-N-Z-I.

The only way to keep the banks afloat is to keep shoveling money down a black hole.

Would more money be better than yes? You betcha, according to the ponzification crowd.

Can ya tell us who got it? No way, according to the ponzification crowd.

Most laughable: It's not who gets it that matters, it's that theres a lot of it and NO ONE knows.

P-O-N-Z-I

[Freenation]

Where is the Money?

[Carolab]

Where is ALL the money? Where are the missing trillions from the Pentagon, Iraq, etc.?

[PhilipTaylor]

This is far worse than the ENRON and Arthur Anderson situations and points to the CRISIS in our Accounting Systems in the Private Sector and in Government!

Without proper accounting and accountability we have no hope of plotting a new FUTURE!

[funkalicious]

This is the mentality of the Federal Reserve, no accountability.

Is it an Innocent Mistake to believe that the bailout money belongs to the people responsible for paying the taxes namely average workers who actually pay taxes.

Don't we deserve to know where and to whom the money has been given?

Why put Tax EvaderTim Geithner in charge of collecting the money to pay secretly? Are they his benefactors?? Average Americans are being taken like Madoffs chumps.

[vesaversa1]

Obama PLEASE !

[ernstge]

I suggest anyone not understanding the Fed Reserve read "The Creature from Jekyll Island" http://www.amazon.com/Creature-Jekyll-Island-Federal-Reserve/dp/0912986212 The Fed is a sham, created in 1910 in a secret meeting by a handful of the world's richest men in secret and then foisted on the US Congress. They control the world to this day. There is no money. It is an illusion. It is backed by nothing and it isn't worth the paper it is printed on. The Fed is a central private bank. We pay for the paper they print in the form of inflation. Let's say that the Fed printed $1 billion in 1929. People made about $5/week. Now people make $500/week, so that paper debt is only 1% of what it was. The other 99% has been paid by us in the form of inflation. Meanwhile the Feds and their member banks loaned out that $billion of non-money many times over and made billions in interest off of something that never really even was. Brilliant idea for them, but a killer for us. I never thought I'd say a book on the Fed would be interesting, but this is one you won't be able to put down. When you finish it, you will understand this whole mess. George

[KingPest05]

So we should write letters to our state reps. and tell them we're against this whole thing. Oh wait ,we tried that. Maybe we should flood the phone lines in thier offices. Oh yeah, we tried that as well. They don't seem to be listening. Hmmmm, I know. We forgot to include gifts and large donations. I wounder what it costs, on average, to buy a reps opinion these days.