Kashkari: 'We Did Not Allow...Collapse'
Neel Kashkari, Treasury's $700 billion man, the guy in charge of distributing the federal bailout/rescue, gave an update on the program's progress today.
"People often ask: how do we know our program is working? First, we did not allow the financial system to collapse. That is the most direct, important information," Kashkari said. "Second, we know the system is more stable than it was when Congress passed the legislation."
This is an interesting point and by its nature, is unprovable. Much like the following: There have been no terrorist attacks on American soil after Sept. 11, 2001, therefore, the government's efforts at stopping terrorism here must have been effective.
Since you can't prove a negative, the answer is unknowable.
"People also ask: when we will see banks making new loans? First, we must remember that just over half the money is out the door," Kashkari said. "This lending won't materialize as fast as any of us would like, but it will happen much faster as a result of having used the [bailout] to stabilize the system and to increase the capital in our banks."
Here are some highlights of the program's distribution so far:
-- On October 28, we funded eight transactions for $115 billion to banks in four states.
-- On November 14, we funded 21 transactions for $33.5 billion to banks in 16 states.
-- On November 21, we funded 23 transactions for $2.9 billion to banks in 16 states.
December 5, 2008; 9:40 AM ET
Categories: The Ticker | Tags: Neel Kashkari, Paulson, Treasury, bailout
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