Sunday, September 21, 2008

$700 Billion Bailout Could Fund Private Foreign Banks

Not only are the fed bailouts giving billions to foreign central banks, but the new $700 billion bailout proposal could bail out private foreign banks as well.

Specifically, a Fact Sheet from the U.S. Treasury says:

Participating financial institutions must have significant operations in the U.S., unless the Secretary makes a determination, in consultation with the Chairman of the Federal Reserve, that broader eligibility is necessary to effectively stabilize financial markets.

An article from today in Politico explains

"In a change from the original proposal sent to Capitol Hill, foreign-based banks with big U.S. operations could qualify for the Treasury Department’s mortgage bailout, according to the fine print of an administration statement Saturday night."

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