Feds Aim to Push Bailout Beyond Traditional Banks

Finance-related firms working with Treasury, which also has eye on Obama transition
By Clay Dillow,  Newser Staff
Posted Nov 7, 2008 11:19 AM CST
Secretary Henry Paulson speaks with reporters during a news conference at the Treasury Department, Oct. 8, 2008, in Washington.   (AP Photo)
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(Newser) – After taking ownership stakes in banks totaling $250 billion, the Treasury is preparing to broaden rescue efforts to include companies outside the banking sector, the Washington Post reports. Hundreds of billions of the $700 billion bailout package could go to relieve some institutions that, though not chartered as banks, borrow and lend money, such as General Motors’ financing arm or insurers.

The initiative likely won’t be announced immediately, as Treasury officials want to give the original $250 billion time to work, but it would make it far easier for the Treasury to aid a wider range of firms involved in credit markets. Industry insiders also said the delay is also partly to ensure that the incoming Obama administration approves of the plan.