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The US treasury’s US$700 billion (A$870 billion) financial rescue plan announced Friday prompted a strong US market rebound and hopes now hinge on speedy Congress approval.
Secretary Treasury Henry M Paulson Junior said the plan would address the “root cause” of the current meltdown by removing distressed assets from the financial system.
Under the plan, the treasury would have authority to step in as a buyer of troubled mortgage assets that few, if any, other institutions would want to purchase.
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The proposal however may stall in a democrat-dominated Congress as lawmakers consider the impact of the added burden on tax payers and an economy already weighed down by national debt.
Published: 22-09-08
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