Fed Releases Thousands Of Pages Of Secret Loan Docs

Tyler Durden's picture

After years of threats about untold destruction should the Fed release discount window borrowings by both the Fed and the Clearinghouse Association (read the bulk of the Primary Dealers), the Fed today released "thousands of pages" of discount window borrowings. And while we are waiting for the docs to be uploaded in a publicly disclosable and legible format, we observe that not only has the market not plunged, but the Dow is in fact higher at this moment, confirming yet again that not only is each and every threat by the Fed that if it does not get its way hollow and baseless, but the whole TARP rescue which pledged over $20 trillion in taxpayer capital to prevent the apocalypse was likely just as much of an empty threat, whose sole purpose was to prevent the bankruptcy of bank management and shareholders. We will release the documents with our analysis as soon as we get them, but in the meantime, here is the summary on this event from Bloomberg, whose employee Mark Pittman was responsible for this lawsuit, and won.

From Bloomberg's Craig Torres:

The Federal Reserve released thousands of pages of secret loan documents under court order, almost three years after Bloomberg LP first requested details of the central bank’s unprecedented support to banks during the financial crisis.

The records reveal for the first time the names of financial institutions that borrowed directly from the central bank through the so-called discount window. The Fed provided the documents after the U.S. Supreme Court this month rejected a banking industry group’s attempt to shield them from public view.

“This is an enormous breakthrough in the public interest,” said Walker Todd, a former Cleveland Fed attorney who has written research on the Fed lending facility. “They have long wanted to keep the discount window confidential. They have always felt strongly about this. They don’t want to tell the public who they are lending to.”

The central bank has never revealed identities of borrowers since the discount window began lending in 1914. The Dodd-Frank law exempted the facility last year when it required the Fed to release details of emergency programs that extended $3.3 trillion to financial institutions to stem the credit crisis. While Congress mandated disclosure of discount-window loans made after July 21, 2010 with a two-year delay, the records released today represent the only public source of details on discount- window lending during the crisis.

“It is in the interest of a central bank to put a premium on protecting its reputation, and, in the modern world, that means it should do everything to be as transparent as possible,” said Marvin Goodfriend, an economist at Carnegie Mellon University in Pittsburgh who has been researching central bank disclosure since the 1980s.

“I see no reason why a central bank should not be willing to release with a lag most of what it is doing,” said Goodfriend, who is a former policy adviser at the Richmond Fed.

And some so called forward looking statements from the two primary beneficiaries of taxpayer largesse:

“I am concerned that in the next crisis it will be more difficult for the Federal Reserve to play the traditional role of lender of last resort,” said Donald Kohn, former Fed vice chairman and senior fellow at the Brookings Institution in Washington. “Having these names made public, or the threat of having them made public, could well impair the efficacy of a key central bank function in a crisis -- to provide liquidity to avoid fire sales of assets -- because banks will be reluctant to borrow.”

“I think it will make it harder for people to use the discount window in the future,” Jamie Dimon, chairman and chief executive of New York-based JPMorgan Chase & Co. (JPM), the second- biggest U.S. bank by assets, told reporters yesterday after a speech in Washington. “We never intend to use the discount window.”

We shall find out very shortly just how often JPM and everyone else used the discount window, that allegedly nobody intended to use.

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gordengeko's picture

This should be interesting.

Fish Gone Bad's picture

My thoughts exactly.  The lender of last resort will end up being the lender of first choice.

Harlequin001's picture

There are those that have used it, and those that are going to use it.

It is unavoidable in a credit environment...

Dr. Richard Head's picture

I would assume that the discount window IS banking at its core now.  Problem is, will anything happen because of this?

gordengeko's picture

Even if they laid this whole scam out in laymans terms, the avg american human resource still wouldn't comprehend it.  The few that would, would just say well nothing I can do about it I have more important things to do like go to work tomorrow and I have to take my daughter to the lady gaga concert friday.

Dr. Richard Head's picture

I have to agree about nothing to do about other than getting out of the system. 

I have petitioned my Congressman, meet with his staff, wrote letters, made phone calls, sent informatino to encourage my friends to do the same, been published in editorials in my local paper, protested, bought gold and silver, withdrawn all funds from stock market, defaulted and settled on debt with unsecured creditors (now debt free on unsecured), challenged my mortgage note, been on national tv bringing up issues, walked door-to-door to help get an audit of the fed, and so many other things that I cannot remember right now.  All of this activity has taken place since 2008.  While the activities, I am sure, have helped in creating more awareness about the issue, most that aren't aware of more concerned about liberal this, or republican that.

I have reserved myself to rants online and getting on a path to self sustaining myself and my family.  As my father has told me, "It is better to save your family from a Katrina like storm rather than try to save the whole city."

Still can't let go of trying to do something about this, but am at a loss for an avenue that will produce results.  Until then I will just continue to drink heavier by the day.

gordengeko's picture

I hear you.  We musn't stop trying tho even if it has resorted to just rants online.  It's possible to make aware just the right person with the right influence at the right time to make a change.  I'm not interested in the masses, they are fucked to be honest,  too far gone with the inoculations, chemicals in the food, propaganda, etc for them to wake up.  They have already pinpointed the location of the "fight or flight" area in the brain, they know how to turn it off.  Thats why no one cares, they already control the majority in the western culture, this is the reason why they are so intent on spreading "democracy".  The reason why they let sites like this, max keiser, www.cuttingthroughthematrix.com, just to name a couple, continue exposing the game is because they have just about complete and total control.  The human species is being mutated, just look at the adolescent males.  Very low % will put up a fight in the future.  They are more interested in wearing skinny jeans and being called an emu, what the fuck is that? 

Canucklehead's picture

Don't you realize the first successful public mind control instrument was the gen 1 cell phone?


You should put that thing down...  It doesn't need to work anymore.  The "apathy or sloth" feature has replaced the "fight or flight" impulse.

gordengeko's picture

Cmon that scene where he's walking on the beach talkin money on the zack morris gen1 in wallstreet is golden!lol  instant classic

SRV - ES339's picture

Hi Doc,

As a Liberal "I feel your pain"... lol!

While I understand the contempt for the L/R nonsense, I also believe it's a mistake to drop out completely... for the very reasons you've laid out. Unfortunately (seriously unfortunate), the political system (sick as it is) is the only "avenue" that can actually reach the average person (like in Wisconsin as an example).

As such, I believe the Progressive agenda is the lesser of two evils (they're in the tank to big business, but only for the money..lol)... the GOP (and the TP, although the rank and file actually believe they're "grassroots") are all in, and willingly support the corporate agenda to rape and pillage the middle and lower classes in the name of ever more profit. I'm sure you have other views (which I do respect) but, other than true civil (middle east like) revolt, the battle must be fought in the political arena... IMHO.

Just tryin' to help out a bit... hate to see a good liver take such a beating... lol!

Dr. Richard Head's picture

Agreed.  Besides, everytime I actually try to quit and go back to sleep it erupts in the open again. 

Harlequin001's picture

I arrived at that conclusion and left for sunnier climes back in 2001.

and never looked back...

dark pools of soros's picture

yeah, Discount Window means the cashier that you know at the grocery that let's you get your produce for free or whatever...  i guess it's the same thing then

crazyjsmith's picture

“I think it will make it harder for people to use the discount window in the future,” Jamie Dimon

And this is a bad thing?  What an A hole!  It should be harder to borrow, these SOB's aren't taking that money and helping the economy out, so, YEAH, it should make it harder, and if they are afraid of transparency, then fail. 

Maybe we wouldn't be in this position if they were forced to make hard choices like the rest of the world.

A HOLES!  Maybe they should be forced to replace the Fukushima 50 - give them all one way tickets to hell.   


InconvenientCounterParty's picture

Oh good. More fodder for those awkward press conferences. As if we needed more.

Harlequin001's picture

“Having these names made public, or the threat of having them made public, could well impair the efficacy of a key central bank function in a crisis -- to provide liquidity to avoid fire sales of assets -- because banks will be reluctant to borrow.

like they have any choice, they can either borrow against crap collateral or sell it into non existent market.

Which one would you choose...

A Nanny Moose's picture

A market always exists. It's just that "they" did not like the price "they" would have gotten for those "assets."

Harlequin001's picture

Not this time Nanny, the market was the same banks that were setting the rates through auctions. Only they could know when the market would crash because only they would know at board level when they would stop bidding for their own account. If you weren't sitting on their Board there's no way you could know.

That's a fix, not a market, which is why the only place they could go was the discount window.

There is no market for this stuff...

lsbumblebee's picture

Don't be surprised if they're printed on solid black construction paper.

Boilermaker's picture

Well, "it was our only option and in the best interest of the American people".

Get very used to that shit.

Oh, the market is melting up.  Back to your regularly scheduled sodomy.

HelluvaEngineer's picture

Sure, they concurrently released a huge buy order, along with the documents.

Mercury's picture

Look at the (soiled) laundry list of companies in the federal government portfolio these days too.

PHDC REV C 177622 [GO]

Holy crap.

TruthInSunshine's picture

“I think it will make it harder for people to use the discount window in the future,” Jamie Dimon, chairman and chief executive of New York-based JPMorgan Chase & Co. (JPM), the second- biggest U.S. bank by assets, told reporters yesterday after a speech in Washington. “We never intend to use the discount window.”


I have two things to say to Mr. Dimon:

1) Good. It should be MUCH harder to use the discount window to glean a competitive and subsidized advantage. At one time, that was called central planning. Banks are and should be treated no differently than factories, asshole.

2) Good, fuckface. We don't want to see JP Morgan, particularly, EVER be able to avail itself of subsidized loans. You don't need to, anyways,  right Jamie? Why would any free market capitalist ever think JP Morgan shouldn't be busted up, let alone get preferential treatment?


Goldman Sachs, JP Morgan, et al. are the modern day scourge on free market capitalism everywhere free market capitalism pretends to exist in the modern world. These corrupt, ruthless and politically powerful 'financial engineers' succeed because they are protected by a network bought and paid for by vast amounts of favors and payoffs, not because they do anything positive for a true supply/demand oriented market. The create markets through anti-capitalistic means, and then bleed ill-gotten gains from the wreckage they have sown.

Alienated Serf's picture

truth, that was pure art.  i nominate you for propaganda minister of the resistance.

LawsofPhysics's picture

I'll second that.  Does the motion carry?

TruthInSunshine's picture


The thing that really pisses me off is that Jamie knows the discount window is closed now, for all practical purposes, at least in the way it had been open during 2009.

So that's why he can make an attempt to sound so independent when he says "we'll never borrow from the discount window" after the fact.

The fucker is really pissing me off. That his firm also employs the likes of Blythe Masters only infuriates me more.

NotApplicable's picture

Meh, no point in getting pissed.

They will get their's in due time.

Until then, just use your knowledge to further isolate yourself from its effects (as likely you already are), and keep a positive attitude due to the comfort of knowing you're not one of the sheeple they will slaughter.

I refer to this attitude as optimistic pessimissim. Yes, we are going to "Hell in a handbasket," but we might as well make the best out of the ride there.

Cdad's picture

Amen, brother Truth,

J. Dimon, in my estimation, has long since overtaken L. Blankfeind as the most disgraceful banker in the nation.  We all know the long list of JP Morgue violations of law, and we have all seen the way in which the bank "beats" earning estimates, and etc.  

However, the richness of this man's sickness was never more clearly on display than from the beautiful hills of Davos when he complained to the world how hard it was to be a millionaire banker.

Unless, of course, you count his complete hypocrisy from yesterday, preparing mom's and pop's all across this broad land to prepare for losses in the muni portfolios while suggesting that losses in Federal debt [not raising the debt ceiling] was literally an "insane" thought.

When you see a man like that, when he is so oblivious to his own arrogance, his corruption, his sense of superior intellect, it is breathtakingly....Faustian.

Yep, J. Dimon really takes the cake...here here, brother Truth.

Dr. Porkchop's picture

There are bankers of a non-disgraceful variety?

NidStyles's picture

Motion carried, now onto the topic of socks and puppets.

SilverFiend's picture

Remember that the resistance does not need to rely on propaganda.  Telling the whole ugly truth will be sufficient.

AlaricBalth's picture

JP Morgan never "intended" to use the discount window because between 2008 and 2009 JPM kept rolling over loans totaling an aggregate of $52 Billion dollars from the FRB's Term Auction Facility at an average interest rate of approximately .33%. These loans were collateralized for the most part by their stellar residential loan portfolio. This rate was much better than the rate charged at the discount window for primary borrowers at that time.

bania's picture

I have a hard time believing incriminating docs will actually see the light of day.

Cognitive Dissonance's picture

I agree.

Forgive my cynical view, but the FED has had over two years to scrub this data of the information it really doesn't want disclosed, then make sure it flows and any counter parties have done so as well. 

Boilermaker's picture

When is the flash crash and the emergency law re-write to avoid this?

Solemn Simulacrum's picture

I'm with you.  Too much time to clean it up.  Let's see if we're wrong.

alien-IQ's picture

"it is a tale told by an idiot, full of sound and fury, signifying nothing"


umop episdn's picture

"We shall find out very shortly just how often JPM and everyone else used the discount window..."

If I was a betting humanoid, I'd be throwing my LOLlars around at this very moment. Liars lie, and this is just another circus of distraction...all in my humble opinion.  

Sean7k's picture


Mark Pittman. Citizen hero. 

Should have been Jaime Demon in his place. 

Boilermaker's picture

+1 honest person against the establishment

tcrown's picture

Just because CEO's announced their company was solvent and expecting their stock to rise and dividends to be paid on the same day they panhandled the FED for 29 billion doesn't mean they lied.  Just optimistic in the future.  Well done boys.  Well done... 

Misean's picture

" the Fed today released "thousands of pages" of discount window borrowings... we observe that not only has the market not plunged, but the Dow is in fact higher at this moment..."

Pavlovian reaction to the Feral releasing printed paper.

Dr. Richard Head's picture

"thousands of pages" = banking solvency, as a whole, depends on the discount window.  Period. The house of cards is built on a base of negative interest rates and free money. 

I am in awe that ANY bank cannot make money when they create credit out of thin air, based on a fraction (possible 0) of their reserves, and then charge usury.  You would have to be a fucking moron not to make money in this manner.


chunga's picture

Get a load of this shit. Nationwide Title Clearing is threatening a volunteer website with a SLAPP suit for publishing a document available on the Internet at many locations. I think by day's end it will be available for download on a couple thousand more sites. Bust their balls and scribd the damn thing everywhere. You'd think NTC would have enough to do with all the titles they have to reverse engineer.

Here's a link to the futile slapp suit...

Here's the site getting "slapped"

Getting rid of that lousy First Amendment ought to send the DOW through the roof...

ivana's picture

FED & utilities for Great Game of expropriation.

Careless Whisper's picture

just wondering, is the halliburton bank & trust on that list?