Exclusive: Foreign banks may get help

Exclusive: Foreign banks may get help
By MIKE ALLEN | 9/21/08 7:24 AM EDT

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.

The theory, according to a participant in the negotiations, is that if the goal is to solve a liquidity crisis, it makes no sense to exclude banks that do a lot of lending in the United States.

Treasury Secretary Henry Paulson confirmed the change on ABC’s “This Week,” telling George Stephanopoulos that coverage of foreign-based banks is “a distinction without a difference to the American people.”

“If a financial institution has business operations in the United States, hires people in the United States, if they are clogged with illiquid assets, they have the same impact on the American people as any other institution,” Paulson said.

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3 Responses to “Exclusive: Foreign banks may get help”

  1. jackenstein Says:

    Funny how, according to the US Constitution, this is illegal, yet it is still being done. It’s like O.J. all over again. All we can do is sit and watch and hope we survive.

    Seems we are so busy taking care of rich corporations and illegal aliens, there doesn’t seem to be any left for poor little ole me. I’m willing to work for it, and pay my fair share, so I guess I don’t qualify.

    Let me add, I think we should all be very concerned that Bank of America (or is it Amexican) has acquired yet another choice financial institution in this country. They are growing exponentially in the world marketplace, and they just got a lot stronger. And it seems whenever they get stronger, America seems to get weaker, or is it just me?

  2. armageddonoutahere Says:

    Hello Jackenstein, It’s not just your imagination. Things are happening
    pretty fast now. It’s like the overtime in a Super Bowl game. They have
    the ball and if they score, the game is over. All we can do is sit helplessly, and watch as they run in for the winning touch down. It looks like our team
    is gonna lose. The only difference is this ‘game’ has much higher stakes.
    When we lose, we really lose.
    (Not the best analogy but it’s all I could come up with.)

  3. armageddonoutahere Says:

    Hello Smithwick, the federal government over the last 20 years pushed the mortgage industry so hard to get minority home ownership up, that it undermined the country’s financial foundation to achieve its goal.

    “In an attempt to increase home ownership, particularly by minorities and the less affluent, an attack on underwriting standards was undertaken by
    virtually every branch of the government since the early 1990s, under
    Clintons administration..

    “The decline in mortgage underwriting standards was universally praised as ‘innovation’ in mortgage lending by regulators, academic specialists, (government-sponsored enterprises) and housing activists.”

    The tool chosen to achieve this goal was one that endangered the entire mortgage enterprise.”

    Now we see the results of this folly.

    Parts of this reply are redacted from:
    By Drew Zahn


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