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
CHAOS: Iranians took to the streets playing celebratory music after reports of Khamenei’s death on Saturday, while mourners also gathered in Tehran yesterday Iranian Supreme Leader Ayatollah Ali Khamenei was killed in a major attack on Iran launched by Israel and the US, throwing the future of the Islamic republic into doubt and raising the risk of regional instability. Iranian state television and the state-run IRNA news agency announced the 86-year-old’s death early yesterday. US President Donald Trump said it gave Iranians their “greatest chance” to “take back” their country. The announcements came after a joint US and Israeli aerial bombardment that targeted Iranian military and governmental sites. Trump said the “heavy and pinpoint bombing” would continue through the week or as long
TRUST: The KMT said it respected the US’ timing and considerations, and hoped it would continue to honor its commitments to helping Taiwan bolster its defenses and deterrence US President Donald Trump is delaying a multibillion-dollar arms sale to Taiwan to ensure his visit to Beijing is successful, a New York Times report said. The weapons sales package has stalled in the US Department of State, the report said, citing US officials it did not identify. The White House has told agencies not to push forward ahead of Trump’s meeting with Chinese President Xi Jinping (習近平), it said. The two last month held a phone call to discuss trade and geopolitical flashpoints ahead of the summit. Xi raised the Taiwan issue and urged the US to handle arms sales to
BIG SPENDERS: Foreign investors bought the most Taiwan equities since 2005, signaling confidence that an AI boom would continue to benefit chipmakers Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) market capitalization swelled to US$2 trillion for the first time following a 4.25 percent rally in its American depositary receipts (ADR) overnight, putting the world’s biggest contract chipmaker sixth on the list of the world’s biggest companies by market capitalization, just behind Amazon.com Inc. The site CompaniesMarketcap.com ranked TSMC ahead of Saudi Aramco and Meta Platforms Inc. The Taiwanese company’s ADRs on Tuesday surged to US$385.75 on the New York Stock Exchange, as strong demand for artificial intelligence (AI) applications led to chip supply constraints and boost revenue growth to record-breaking levels. Each TSMC ADR represents
State-run CPC Corp, Taiwan (CPC, 台灣中油) yesterday said that it had confirmed on Saturday night with its liquefied natural gas (LNG) and crude oil suppliers that shipments are proceeding as scheduled and that domestic supplies remain unaffected. The CPC yesterday announced the gasoline and diesel prices will rise by NT$0.2 and NT$0.4 per liter, respectively, starting Monday, citing Middle East tensions and blizzards in the eastern United States. CPC also iterated it has been reducing the proportion of crude oil imports from the Middle East and diversifying its supply sources in the past few years in response to geopolitical risks, expanding
RSS