Green’s Dictionary of Slang

(US) a dismissive phr. used to disguise knowledge one does not wish to admit, lit. would a competitor help its rival?

1930		Akron Beacon Jrnl (OH) 12 June 21/1: [of two NYC Jewish pushcart pedlars] ‘I sad [sic] ’ reiterated Moe, ‘Howz business?’ To which the stubborn Ben boomed: ‘Does Macy’s tell Gimbel?
1942		A. Baer 10 Mar. [synd col.] We all know the story of the push-cart pedler asking his rival wheelbarrow merchant how things were going and getting the answer, ‘Does Macy’s tell Gimbel’s’.
1950		E. Sullivan [synd. col.] 20 Dec. ‘Did you know that Primo Carnera was going to punch at you,’ asked the UCLA co-ed. [Jack] Dempsey broke out in a wide smile: ‘Hon, does Macy’s tell Gimbels’.
1968		G. Radano Walking the Beat 162: Once he [i.e. a sergeant] asked me the whereabouts of a card game on my post. I told him I didn’t know of any game. Why should I tell him? Does Macy’s tell Gimbels?
1975		Miami Herald 23 Mar. 10-AW/3: Yet as far as FBI records are concerned, the CIA still ‘doesn’t know him.’ (Does Macy’s tell Gimbel’s?).
1987		Roanoke Times (NC) 8 Jan. 11/5: They used to say ‘Does Macy’s tell Gimbel’s?’ Well, Gimbels is gone now.