Geighner To Unveil New Bank Rescue Plan

Treasury Secretary Timothy Geithner says he will propose a new investment fund to buy troubled home loans (mortgages) and other complex assets (securities) connected to them.

The "Public Private Investment Program" would combine taxpayer money with private funds to buy between $500 billion and $1 trillion worth of bad assets from failing banks.

The money would partially come from an economic rescue package Congress approved last year.

The financial system spiraled into chaos last year after hundreds of thousands of Americans failed to pay their home loans, squeezing the funds available for banks to lend to other consumers.

Geithner is hoping the banks will begin lending again if they are freed of their toxic assets.

The housing crisis that spread throughout the entire U.S. economy helped trigger a global recession.

U.S. President Barack Obama says he sees some hope that the housing market is improving, and that the U.S. economy may be starting to recover from the recession.

In a television interview broadcast Sunday, the president says increasing numbers of homeowners are taking advantage of low interest rates and refinancing their home loans.

He also acknowledges that people are angry that taxpayer money intended to rescue ailing banks instead was used to pay large bonuses to the executives of insurance company AIG.

But Mr. Obama questions the legality of a bill Congress passed last week that would impose a 90 percent tax on the bonuses.

By VOA News.