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U.S. Finance “Starting to Heal” – Geithner

The government is making headway in battling the financial crisis and will continue to make progress in the coming months, according to U.S. Treasury Secretary Timothy Geithner.

In a report to the Senate Banking Committee, Geithner said that the financial system is “starting to heal” from the damage it incurred from the housing bubble and the economic recession that ensued.

However, he added, the prospects are still fragile and the Obama administration is taking great caution in using its $700-billion recovery fund. The fund, approved by Congress in October 2008, is now down to about $123.7 billion. Geithner said that the Treasury may pull out financing from other programs in order to preserve the funds.

The Treasury expects to recover around $25 billion as banks start to repay the bailout loans they received earlier in the crisis. A few lawmakers have pushed for the use of these funds in paying off U.S. debt, rather than funding future bailouts.

Geithner remains positive that aggressive action can prevent a financial meltdown, but conceded that the government was extending an unusual amount of support to private banks. He added that the government will remain flexible to exploring new solutions to the crisis.

 

Earlier in Government:
New Rules for Home Loan Modification Begin June 1, 2010
Government Steps Up Loan Modification Anti-Fraud Efforts
Government Gears Up for Financial Literacy Month, Warns Against Scams

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