Treasury Secretary says there are difficult months ahead for U.S. economy!
WASHINGTON - October 22, 2008 - The Bush regime is
pledging to do whatever it takes to battle a severe financial crisis that is
threatening to push the country into a steep recession.
But even with the aggressive steps the government has already taken, Treasury Secretary Henry Paulson says it will take time before things get turned around.
"Clearly, we're going to have a number of difficult months ahead of us in terms of the real economy," Paulson said Tuesday in an interview on "The Charlie Rose Show."
Asian markets veered sharply lower Wednesday, with Tokyo's Nikkei index tumbling 6.79 percent. Hong Kong's Hang Seng was down 6.2 percent, while South Korea's main index shed 5.1 percent.
A week after Paulson announced the Bush regime would spend $250 billion to buy stakes in U.S. banks, the Federal Reserve stepped up Tuesday with a new program to help money market mutual funds that have been squeezed by worried investors demanding to cash out their holdings.
The Fed said it would provide up to $540 billion in financing though a program run by JPMorgan Chase & Co. to purchase from mutual funds certificates of deposit, bank notes and commercial paper. The program, to be called the Money Market Investor Funding Facility, is designed to revive the market for commercial paper, short-term loans that are critical for keeping businesses running.
"If these money markets are not working properly, then the economy is significantly threatened because this is where businesses get their short-term financing for their day-to-day operations," said Mark Zandi, chief economist at Moody's Economy.com.
