Bailout, Banks and More Collapses

  US Congressional leaders and the Bush administration have reached a tentative deal on a bailout of imperiled financial markets that could cost taxpayers hundreds of billions of US dollars.The House could vote on it later today and the Senate on Tuesday. & #160;US House of Representatives Speaker Nancy Pelosi announced the accord just after midnight Saturday and said it still has to be put on paper. & #160;Treasury Secretary Henry Paulson talked of finalising the deal but added: & quot;I think we're there. & quot;The plan would spend up to & #36;US700 billion, most of it on buying deeply devalued mortgages from the housing market's collapse and other bad loans held by tottering banks and other investors.The aim is to prevent credit from drying up and causing a meltdown of the US economy, which is still on the cards.Media reports indicated the & #36;US700 billion request could end up being cut by as much as half, with the rest subject to congressional approval at a later date.The proposed bailout, first rushed to Capitol Hill by Paulson as a three-page proposal, has now ballooned into a document of more than 100 pages, CNN reported.A Democratic Senator said & #36;US250 billion would be immediately available and another & #36;US100 billion could be used when requested by the president for debt purchases.The Congress could bar the expenditure of the remaining & #36;US350 billion only by passing a resolution to block it from being spent.Several other provisions in the proposed bill include more oversight and a way for the Government to reclaim losses from companies on mortgage related assets that lose money.  

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