- AIG, Symbol of Crisis, Watches Its Stock Zoom Back
- Disney Profit, Sales Top Street Forecasts; Shares Jump
- Despite Rhetoric, Obama Has Few Options to Boost Jobs
- Cities With the Most Home Price Reductions
- US Debating What to Do With Billions of TARP Money Left
- Alleged Florida Ponzi Scheme Could Top $1 Billion
- Forecast From Retailers: Proceed With Caution
- Nordstrom Earnings Miss Forecasts; Shares Take Hit
- Housing Recovery 'In Uncharted Territory': HUD Chief
- Intel's Andy Bryant Offers An Explanation
- US 'Actively Working' on Weaker Dollar: Fund Manager
- Options Boil on Biotech Buyout Rumors
- Warren Buffett's $100,000 Offer and $500,000 Advice for Columbia Business School Students
- Activision Blizzard's "Modern Warfare 2" Sales Break Records
- 5-Star Manager's 5 Stocks for Changing Markets
- What's The Forecast from Retailers? Proceed With Caution
- Disney's CFO-Theme Park Chairman Executive Swap
- Road Rage Rants
MOST SHARED
- A Public Hearing That Isn't Public
- Meet The Leaders of the New Retail Revolution
- Warren Buffett and Bill Gates Share Their 'Optimism' With Eager Columbia Business Students
- Cities With the Most Home Price Reductions
- "Friending" Big Pharma
- Disney Profit, Sales Top Street Forecasts; Shares Jump
- Disney CFO and Parks Chief to Swap Roles
- Despite Rhetoric, Obama Has Limited Options To Boost Jobs
- Housing Recovery 'Still In Uncharted Territory': HUD Secretary
Speedy Congress approval for a $700 billion plan to bail out the U.S. banking system is paramount to avoid a meltdown of the markets, analysts told CNBC on Wednesday.
But at the same time lawmakers need to make sure they ask the right questions before handing Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke a blank check, they added.
"What do you think we will be discussing on this programme if this package falls over? The answer is we will be discussing total carnage in the credit markets and potentially massive financial systemic risk," Anthony Fry of Evercore partners said.
Paulson and Bernanke were forced to defend their bailout plan in front of a US Senate Committee, as many argued that the package lacked vital details. Hearings will resume later on Wednesday.
The legislation, which would allow the government to buy bad mortgages and other troubled assets from financial institutions, has faced numerous delays, weighing on the markets.
"We are in crisis mode, and there is a real desire to see some way in which we can stabilise the markets," said Dr Herbet London, President of the Hudson Institute, who also ran as a Republican Candidate for the Mayor of New York in 1989.
But crucial questions still need to be answered, he added. "Where do you draw the line and say the Federal government can’t own Fannie Mae [FNM
Loading...
()
], Freddie Mac [FRE
Loading...
()
] and AIG [AIG
Loading...
()
]? It is quite extraordinary".
Treasury Secretary Paulson asked Congress to act swiftly on the $700 billion plan, which, he says, will help to ensure financial stability, while Ben Bernanke warned lawmakers that a rejection of the plan would further hurt the U.S. economy, which is already under pressure.
Political debate intensified with presidential candidates from both camps raising doubts about the Bush administration's package, and demanding conditions that could continue to stall its implementation.
"I think what McCain is going to ask for is, 'give me some guarantees, give me an understanding of what is going to happen going forward. I will obviously buy into this proposal, but I want to make sure the people who represent the free market individuals in my party are satisfied with the direction this is taking,'" said London.
John McCain, who a week ago said the economy was fundamentally sound, has also expressed worries about giving too much power to Treasury Secretary Hank Paulson.
Democratic candidate Barack Obama urged Congress to approach the bailout proposal in a bipartisan manner, and that a blank cheque shouldn't be given without oversight and accountability.
"In the case of Obama, he is probably coming out way ahead on this matter," London conceded, as Obama urged Washington to recognise that true economic recovery requires addressing not just the crisis on Wall Street, but the crisis on Main Street.
- Warren Buffett and Bill Gates spoke to Columbia students, and Buffett made the students a startling offer.
- They may have wrecked their companies or saved our economy. Tell us what you think.
- Big pharma embraces social media, but how much should a tightly regulated sector say on Facebook or Twitter?
- A European dating site finds lovelorn singles from one country to be consistently uglier. Which is it?
- Contributor David Pogue looks at two of the latest efforts to perfect the digital pocket camera.
- PepsiCo is ramping up its onsite health facilities for workers.












