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Paulson Announces New Plans to Buy Equity Stakes in Banks and Revive Credit Markets
The U.S. government yesterday (Tuesday) announced plans to invest $250 billion, more than a third of the $700 billion congressional bailout allotment, into nine of America’s largest banks in an effort to bolster confidence in the financial system. Similar to steps taken by European governments earlier this week, the government will guarantee new debt and take equity stakes in the participating banks.
"Government owning a stake in any private U.S. company is objectionable to most Americans – me included," U.S. Treasury Secretary Henry Paulson said announcing his decision to effectively nationalize the nation’s banking sector. “Yet, the alternative of leaving…
15Oct2008 | Money Morning | Comments Off | Continued
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