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George Bush Speaks - Market up almost 400

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  • George Bush Speaks - Market up almost 400

    Bush vows his team will meet challenges of financial crisis

    4 hours ago
    WASHINGTON (AFP) — US President George W. Bush vowed Thursday his administration would meet the challenges of the global financial crisis, after the Federal Reserve injected 180 billion dollars into the banking system.
    "The American people are concerned about the situation in our financial markets and our economy. And I share their concerns," Bush said at the White House.
    "The American people can be sure we will continue to act to strengthen and stabilize our financial markets and improve investor confidence," he added.
    It was the president's first public comments on the global financial turmoil since Monday, when the venerable Wall Street investment bank Lehman Brothers filed for bankruptcy protection, sending markets into a tailspin.
    Bush said he had canceled travel plans Thursday to remain in Washington.
    "I'll continue to closely monitor the situation in our financial markets, and consult with my economic advisors," he said.
    "Our financial markets continue to deal with serious challenges" despite the federal government's "extraordinary" measures to address them in recent weeks, the president said.
    The Federal Reserve announced earlier Thursday a massive 180-billion-dollar temporary liquidity line to five other leading central banks to pump cash into the stressed global banking system, and said it was ready to do more.
    The Fed was joined by the European Central Bank and the British, Canadian, Japanese and Swiss central banks in offering to swap currencies for dollars, taking the total liquidity to some 300 billion dollars.
    Central banks now have spent more than 600 billion dollars this week to avert the collapse of the global banking system.
    Bush recounted a litany of steps taken recently by the federal government to ease the crisis, including the nationalization of mortgage finance giants Fannie Mae and Freddie Mac on September 7, the Fed's 85-billion-dollar bailout of insurance titan AIG on Tuesday, and the creation of new rules aimed at curbing equities speculation on Wednesday.
    "This week the Federal Reserve acted to prevent the disorderly failure of the insurance company AIG, a development that could have caused a severe disruption in our financial markets and threatened other sectors of the economy," Bush said.
    "Yesterday, the Securities and Exchange Commission took action to strengthen investor protections and step up its enforcement action against illegal market manipulation."
    The SEC's new rules are aimed at curbing speculative "naked short" sales that aim to profit from falling share prices.
    "These actions are necessary and they are important. And the markets are adjusting to them. As our recent actions demonstrate, my administration is focused on meeting these challenges," Bush said.
    The Bush administration is scrambling to avert a financial collapse that began under its eight-year watch in the US housing market. After years of boom fueled by easy credit, the market went bust in mid-2006 as lending criteria tightened.
    The worst slump in the US real-estate sector in decades stemmed from rising defaults on home loans, particularly subprime mortgages given to borrowers with poor credit histories.
    The financial turmoil that erupted in August 2007 from the subprime mortgage crisis has forced companies to write off tens of billions of dollars in related losses and curbed growth in the world economy.
    AIG alone has written off 25 billion dollars amid spiking defaults on US mortgage payments in the United States.
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  • #2
    NEW YORK - Wall Street rallied in a stunning late-session turnaround Thursday, shooting higher and hurtling the Dow Jones industrials up 400 points following a report that the federal government may create an entity that will take over banks' bad debt.

    A report that Treasury Secretary Henry Paulson is considering the formation of an entity like the Resolution Trust Corp. that was set up during the savings and loan crisis of the late 1980s and early 1990s left investors ebullient. Investors hoped a huge federal intervention could help financial institutions jettison bad mortgage debt and stop the drain on capital that has already taken down companies including Bear Stearns Cos. and Lehman Brothers Holdings Inc.
    Closes up 410 points

    "Can't buy what I want because it's free...
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    • #3
      Originally posted by 007 View Post
      I credit Bush
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