Paulson Now Wants to Focus on Consumer Lending

Jen Chung

Published Nov 12, 2008

Modified Nov 12, 2008

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Jen Chung

Published Nov 12, 2008

Modified Nov 12, 2008

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Bloomberg News reports that Treasury Secretary Henry Paulson wants to use part of the $700 billion bailout "to help relieve pressures on consumer credit, scrapping an effort to buy devalued mortgage assets." Paulson said earlier today, "Illiquidity in this sector is raising the cost and reducing the availability of car loans, student loans and credit cards. This is creating a heavy burden on the American people and reducing the number of jobs in our economy" and acknowledged buying the troubled assets of financial institutions was "not the most effective" use of bailout money. In other news, the Dow, Nasdaq and S&P 500 are down about 3% due to, according to CNBC, "doubt about the effectiveness of government intervention seeped deeper into the market." (AmEx has lost more than 8%.)