In the News: Paulson Shifts Bailout Strategy

Treasury Secretary Henry Paulson announced that the government is officially abandoning the original $700 billion effort to rescue the nation’s financial system approved by Congress and President Bush last month. The Treasury Department will still continue to invest in financial institutions but will also focus on struggling consumers. He said the Fed will try to increase the availability of credit cards as well as student and car loans, perhaps through a new Federal Reserve lending facility aimed at unlocking the frozen consumer credit market. The Treasury is also examining ways to help prevent future foreclosures.

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