White House and Fed rift over bank bail-outs - papers 27 Mar

It is understood that President Bush and his advisers are concerned about the repercussions of protecting a financial institution from bankruptcy because of its own poor decisions. The White House is anxious about the long-term implications of a bank bailout and of the extension of emergency cheap credit facilities to investment firms. In what is an election year in the United States, the President is worried that Washington will be accused of using taxpayers’ money to protect executives, staff and shareholders from the consequences of poor risk management. He also fears that Wall Street ...