US Treasury Secretary Henry Paulson was to unveil a plan yesterday to beef up the Federal Reserve in the latest US bid to calm economic turmoil stirred up by the "subprime" lending crisis.
The federal government was to propose giving sweeping new oversight powers to the Fed, including tighter surveillance of financial markets in a bid to avoid calamities like the current US mortgage chaos.
US financial regulatory agencies have been accused by experts of failing to recognize rampant excesses in mortgage lending until after they set off what is now seen as the worst US financial crisis in decades.
"With very few exceptions, most of this blueprint should not and will not be implemented until after the present market difficulties are past," Paulson said in an interview with the Wall Street Journal.
"But we've got a chance of getting people to look at it more broadly now. In that way, I think the timing is great," he said in its online edition.
Paulson scheduled a press conference for 3pm GMT yesterday at the Treasury Department where he was expected to unveil the restructuring plan.
A summary obtained over the weekend by US media indicated the Fed would gain the power to investigate any activities of financial institutions that threaten US economic stability, gather information and combat risks to the financial system as a whole.
The proposal is the most ambitious overhaul of the regulatory agencies since the mid-19th century, when the system was gradually put into place after the US civil war, the Journal reported.
The Securities and Exchange Commission would lose some of its authority and is likely to be combined with the Commodity Futures Trading Commission that regulates trade in gas, oil and other goods, the New York Times said.
The report came as new statistics showed US consumer spending stalled in February despite rising incomes as Americans boosted savings amid recession fears.
The subprime crisis appears to have claimed another victim yesterday as the Journal reported that US Housing and Urban Development Secretary Alphonso Jackson was poised to announce his resignation.
Citing people familiar with the matter, the newspaper said the departure would deal a blow to efforts by the administration of US President George W. Bush to tackle the housing and mortgage crisis.
On Wednesday, Paulson called on the Fed to broaden its surveillance of financial institutions, just days after it authorized investment banks -- including Goldman Sachs, Merrill Lynch and Lehman Brothers -- to use emergency measures and borrow at the discount rate normally reserved for commercial banks.
Also see: Optimism falters in US
The combined effect of the monsoon, the outer rim of Typhoon Fengshen and a low-pressure system is expected to bring significant rainfall this week to various parts of the nation, the Central Weather Administration (CWA) said. The heaviest rain is expected to occur today and tomorrow, with torrential rain expected in Keelung’s north coast, Yilan and the mountainous regions of Taipei and New Taipei City, the CWA said. Rivers could rise rapidly, and residents should stay away from riverbanks and avoid going to the mountains or engaging in water activities, it said. Scattered showers are expected today in central and
COOPERATION: Taiwan is aligning closely with US strategic objectives on various matters, including China’s rare earths restrictions, the Ministry of Foreign Affairs said Taiwan could deal with China’s tightened export controls on rare earth metals by turning to “urban mining,” a researcher said yesterday. Rare earth metals, which are used in semiconductors and other electronic components, could be recovered from industrial or electronic waste to reduce reliance on imports, National Cheng Kung University Department of Resources Engineering professor Lee Cheng-han (李政翰) said. Despite their name, rare earth elements are not actually rare — their abundance in the Earth’s crust is relatively high, but they are dispersed, making extraction and refining energy-intensive and environmentally damaging, he said, adding that many countries have opted to
FORCED LABOR: A US court listed three Taiwanese and nine firms based in Taiwan in its indictment, with eight of the companies registered at the same address Nine companies registered in Taiwan, as well as three Taiwanese, on Tuesday were named by the US Department of the Treasury’s Office of Foreign Assets Control (OFAC) as Specially Designated Nationals (SDNs) as a result of a US federal court indictment. The indictment unsealed at the federal court in Brooklyn, New York, said that Chen Zhi (陳志), a dual Cambodian-British national, is being indicted for fraud conspiracy, money laundering and overseeing Prince Holding Group’s forced-labor scam camps in Cambodia. At its peak, the company allegedly made US$30 million per day, court documents showed. The US government has seized Chen’s noncustodial wallet, which contains
SUPPLY CHAIN: Taiwan’s advantages in the drone industry include rapid production capacity that is independent of Chinese-made parts, the economic ministry said The Executive Yuan yesterday approved plans to invest NT$44.2 billion (US$1.44 billion) into domestic production of uncrewed aerial vehicles over the next six years, bringing Taiwan’s output value to more than NT$40 billion by 2030 and making the nation Asia’s democratic hub for the drone supply chain. The proposed budget has NT$33.8 billion in new allocations and NT$10.43 billion in existing funds, the Ministry of Economic Affairs said. Under the new development program, the public sector would purchase nearly 100,000 drones, of which 50,898 would be for civil and government use, while 48,750 would be for national defense, it said. The Ministry of
RSS