Senate passes $700 billion Wall Street deal
One house of the US Congress has now approved the Treasury’s deal, but it could still fail
WASHINGTON, DC – The US Senate has passed a revised version of the Treasury’s $700 billion (£380 billion) bail-out plan. Both political parties in the upper house of Congress strongly supported the deal in a vote last night that President George W Bush said was “essential to the financial security of every American”.
To placate opponents of the plan, the redrawn proposal now includes $110 billion in tax breaks – with an emphasis on small businesses, and an increase in depositor protection from $100,000 to $250,000.
Senate leaders and both presidential candidates (who suspended electioneering for the vote) conspicuously avoided describing Treasury secretary Henry Paulson’s plan as a bail-out for Wall Street banks.
Whether the bill will pass through the House of Representatives after its narrow rejection on Monday depends on Republican whips’ ability to coerce rebels into backing the bill, which is widely seen as un-American and impolitic due to its unpopularity with anti-Wall Street blue-collar workers whose houses are in danger of repossession.
The bill is also unpopular among Democrats. Despite their having voted largely in favour of the bill at its last reading, it is uncertain how many more will be swayed by this revised offering. Many voted out similar tax cuts earlier this year, citing government failure to balance its books.
The House of Representatives will vote again on Friday.
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe
You are currently unable to print this content. Please contact info@risk.net to find out more.
You are currently unable to copy this content. Please contact info@risk.net to find out more.
Copyright Infopro Digital Limited. All rights reserved.
As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (point 2.4), printing is limited to a single copy.
If you would like to purchase additional rights please email info@risk.net
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (clause 2.4), an Authorised User may only make one copy of the materials for their own personal use. You must also comply with the restrictions in clause 2.5.
If you would like to purchase additional rights please email info@risk.net
More on Regulation
Esma supervision proposals ensnare Bloomberg and Tradeweb
Derivatives and bonds venues would become subject to centralised supervision
Industry frowns on FCA’s single-sided trade reporting efforts
Buy side warns UK attempt to ease Mifir burden may miss target; dealers aren’t happy either
One vision, two paths: UK reporting revamp diverges from EU
FCA and Esma could learn from each other on how to cut industry compliance costs
Market doesn’t share FSB concerns over basis trade
Industry warns tougher haircut regulation could restrict market capacity as debt issuance rises
FCMs warn of regulatory gaps in crypto clearing
CFTC request for comment uncovers concerns over customer protection and unchecked advertising
UK clearing houses face tougher capital regime than EU peers
Ice resists BoE plan to move second skin in the game higher up capital stack, but members approve
ECB seeks capital clarity on Spire repacks
Dealers split between counterparty credit risk and market risk frameworks for repack RWAs
FSB chief defends global non-bank regulation drive
Schindler slams ‘misconception’ that regulators intend to impose standardised bank-like rules