Government plans new program to aid credit issuers

[babylonsister]

Government plans new program to aid credit issuers

By JEANNINE AVERSA – 25 minutes ago

WASHINGTON (AP) — The government is working on a new loan program to help companies that issue credit cards, make student loans and finance car purchases, people familiar with the plan said Tuesday.

The Treasury Department and the Federal Reserve will unveil the program Tuesday. Those who spoke about the plan did so on condition of anonymity because a formal announcement had yet to be made.

Treasury Secretary Henry Paulson has said he plans to use a "relatively modest share" of the $700 billion financial bailout money to pay for the new program.

It's the latest effort by the government to break through a dangerous credit clog that has badly hurt the economy.

Since the financial meltdown accelerated in September, credit card issuers have been tightening their standards. A survey released Nov. 3 by the Federal Reserve found that a sizable percentages of banks had "continued to tighten their lending standards and terms on all major loan categories over the previous three months." Nearly 60 percent of banks responding to the survey said they had tightened lending standards on credit card debt.

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP's earlier story is below.

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http://www.google.com/hostednews/ap/article/ALeqM5i2btpTl7SJHsQYZ7SgyB6QkqAzNwD94LVI6O0

[tnlurker]

1. What they fail to realize is the people do not need more credit

They need more money in their pockets in the form of better wages. Or they need their already large debt load reduced. I get credit card offers every day that I throw in the trash. What I really need is a larger paycheck or a forgiveness of my credit balances. That would be helpful to millions of people and would stimulate the economy. Nothing that they have proposed yet has addressed those issues.

[midnight]

2. "credit card issuers have been tightening their standards"

To bad we ,the tax payer didn't tighten ours, and refuse to hand over billions of dollars for whatever purpose they "the banks" wanted to use it without any strings attached. Money for student loans should of been forth coming. Not a "relatively modest share" of the $700 billion. And those suffering with outrages mortagages should be helped too. That would unclog that dangerous clog that badly hurt the ecomomy.