The Naked Emperor Hank Paulson is at it again. How to dig ourselves out of our borrow-spend-panic binge?
Why, of course: Encourage more borrowing, spending and panicking!
The U.S. Treasury and Federal Reserve will unveil as soon as today a lending program to shore up the consumer-finance market, using money from the government’s $700 billion rescue, two people familiar with the effort said.
The Treasury and the Fed will help fund new loans packaged into securities for sale to investors, the people said. Treasury Secretary Henry Paulson, who scheduled a press conference for 10 a.m. New York time, said two weeks ago that he wants to spur lending for automobile purchases and college education while also reducing the cost of credit-card debt.
Paulson and Fed Chairman Ben S. Bernanke are widening the scope of their rescue efforts after agreeing two days ago to guarantee $306 billion of Citigroup Inc.’s toxic assets. Paulson has spent most of the first half of the government’s Troubled Asset Relief Program aiding Wall Street banks, and pressure is growing in Congress to help average Americans.
“Paulson needs to be seen taking a leadership position,” said Axel Merk, president of Merk Investments LLC in Palo Alto, California. “The markets are desperately looking for guidance on the way forward.”
Blind leading the blind.
Barbara Mikulski approves. Flashback: Dumb idea of the day: Hey, let’s encourage a nation in debt to borrow and buy even more!