Fed Distances Itself From Banks, Says Will Not Seek Review Of "Pittman" Even Though It Is Lawsuit Defendant

Tyler Durden's picture

Amusingly, following up on earlier reports that the Clearing House Association (aka the banking oligarchy) will petition the SCOTUS to hide their oh so very secret insolvency which by now everyone knows about, the Fed has decided to amusingly distance itself from the kleptocratic crowd and will not seek court review. In other words, the public's anger when the SCOTUS sides with the bankers will fall squarely upon Lloyd Blankfein et al, and not Ben Bernanke, even though it is the Fed who is the defendant in the Pittman lawsuit. This is just plain ridiculous. And the reason provided by the banks: why more mutual assured destruction of course: "disclosure of the information threatens to harm the borrowing banks by allowing the public to observe their borrowing patterns during the recent financial crisis and draw inferences--whether justified or not--about their current financial conditions." Here is an inference about their current financial conditions: they are all insolvent. Does that matter? No. Because the only holders of bank stocks now are other banks. It is called a ponzi for a reason after all.

More from Dow Jones:

An association of large commercial banks on Tuesday asked the U.S. Supreme Court to review a ruling that ordered the Federal Reserve to disclose information about the banks that borrowed from its discount window and other emergency lending programs during the financial crisis.

In its petition to the high court, the Clearing House Association said disclosure of the information "threatens to harm the borrowing banks by allowing the public to observe their borrowing patterns during the recent financial crisis and draw inferences--whether justified or not--about their current financial conditions."

Bloomberg LP 's Bloomberg News and Fox News Network LLC's Fox Business Network separately sought the Fed disclosures under the Freedom of Information Act and sued the Fed when it denied their requests. The news organizations sought the names of the borrowing banks, loan amounts, origination dates and the collateral involved.

Fox News Network is a unit of News Corp . (NWS, NWSA), which owns Dow Jones & Co ., publisher of this newswire.

The New York-based 2nd U.S. Circuit Court of Appeals ruled in March that the Fed was required to disclose documents about bank borrowing from its last-resort lending programs.

The Fed's Board of Governors and the Clearing House Association have argued that the ruling could severely undermine the Fed's ability to implement lending programs critical to the economy and monetary policy.

The Fed has not yet filed a petition seeking Supreme Court review.

After the 2nd Circuit refused in August to reconsider the case, it stayed its ruling for 60 days to give the parties the opportunity to petition the high court.