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Dodd Moves to Lend FDIC $500B

By Kevin Spak,  Newser Staff

Posted Mar 6, 2009 8:23 AM CST

(Newser) – Senate Banking Chairman Chris Dodd has introduced a bill to allow the FDIC to borrow up to $500 billion from the Treasury Department, the Wall Street Journal reports. It’s the latest attempt to bolster the fund that insures consumer deposits, which has been ravaged by a string of bank failures. Last week, the FDIC proposed raising fees for the same purpose, provoking loud protests from bankers.

The measure comes at the insistence of Timothy Geithner, Ben Bernanke, and the FDIC's Sheila Bair. One provision in the bill, suggested by Bernanke, could turn the FDIC into another dispenser of bailouts, giving it expanded power to address “systemic risks” to the economy.

Senate Banking Committee Chairman Christopehr Dodd, left, and the committee's ranking Republican Richard Shelby, talk with Bob Corker, on Capitol Hill, Feb. 5, 2009.
Senate Banking Committee Chairman Christopehr Dodd, left, and the committee's ranking Republican Richard Shelby, talk with Bob Corker, on Capitol Hill, Feb. 5, 2009.   (AP Photo/Susan Walsh)
Senate Banking Committee Chairman Chris Dodd, left, asks a question of Treasury Secretary Tim Geithner, as Richard Shelby  listens during the committee's hearing on Capitol Hill.
Senate Banking Committee Chairman Chris Dodd, left, asks a question of Treasury Secretary Tim Geithner, as Richard Shelby listens during the committee's hearing on Capitol Hill.   (AP Photo/Susan Walsh)
Treasury Secretary Tim Geithner, left, shakes hands with Chris Dodd, right, on Capitol Hill on Feb. 10, 2009, prior to testifying before the committee.
Treasury Secretary Tim Geithner, left, shakes hands with Chris Dodd, right, on Capitol Hill on Feb. 10, 2009, prior to testifying before the committee.   (AP Photo)
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COMMENTS
Showing 3 of 5 comments
nick
Mar 7, 2009 7:00 PM CST
Good move. Give the reins (more power) to the FDIC. It's long overdue.
BackAgain
Mar 7, 2009 6:53 AM CST
Nice job PaleRider. I wonder how the Mediterranean security trip went for Dodd? Can you spell taxpayer vacation? Both parties stink. I was really hoping for some change and hope. Oh well.
Guest
Mar 6, 2009 5:45 AM CST
Like I said, you have the wrong person, but like a typical Liberal, facts really don't matter, If you wanna start getting personal, you won't like how it turns out.

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