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WASHINGTON -- That $700 billion financial bailout passed by Congress and signed by President Bush is a big package.
But wait, there's more.
The total amount of federal money spent or being put on the line to rebuild the nation's financial system is considerably more once various other steps potentially involving taxpayer money are taken into account, easily running into the trillions.
Here are some of the major steps -- and associated price tags -- of actions the government has taken this year to deal with the spreading crisis in credit and housing markets:
• March 11: The Federal Reserve announces a rescue package to provide up to $200 billion in loans to banks and investment houses and let them put up risky mortgage-backed securities as collateral.
• March 16: The Fed provides a $29 billion loan to JPMorgan Chase & Co. as part of its purchase of investment bank Bear Stearns.
• May 2: The Fed increases the size of its loans to banks and lets them put up less-secure collateral.
• July 11: Federal regulators seize Pasadena, Calif-based IndyMac, costing the Federal Deposit Insurance Corp. billions to compensate deposit-holders.
• July 30: President Bush signs a housing bill including $300 billion in new loan authority for the government to back cheaper mortgages for troubled homeowners.
• Sept. 7: The Treasury takes over mortgage giants Fannie Mae and Freddie Mac, putting them into a conservatorship and pledging up to $200 billion to back their assets.
• Sept. 16: The Fed injects $85 billion into the failing American International Group, one of the world's largest insurance companies.
• Sept. 16: The Fed pumps another $70 billion into the nation's financial system to help ease credit stresses.
• Sept. 19: The Treasury temporarily guarantees money market funds against losses up to $50 billion.
• Sept. 29: The Fed makes an extra $330 billion available to other central banks, boosting to $620 billion the amount available to the central bank through currency "swap" arrangements, where dollars are traded for their currencies.
It also triples to $225 billion the amount available for short-term loans to U.S. financial institutions.
• Oct. 3: President Bush signs the $700 billion economic bailout package.
• Oct. 6: The Fed increases a short-term loan program, saying it is boosting short-term lending to banks to $150 billion and that by year's end, $900 billion in potential overall credit will be outstanding. It also says it will begin paying interest on reserves that banks keep with the Fed in hopes of coaxing banks into keeping more money on deposit at the central bank.
• Oct. 7: The Fed says it will start buying unsecured short-term debt, so-called "commercial paper," from companies.
• Oct. 8: The Fed cuts the federal funds rate a half percentage point, to 1.5 percent.
It follows a one-quarter point cut on April 30 and a three-quarter point reduction on March 18.
• Oct. 8: The Fed agrees to lend AIG another $37.8 billion. |
