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| Version 3 | Version 4 |
|---|---|
| US edges closer to bail-out deal | |
| (about 2 hours later) | |
| US Republican and Democratic Party lawmakers have said they are getting closer to agreeing a massive rescue plan to aid the financial markets. | |
| Democrat senator Harry Reid told the upper house that "significant progress" had been made, but stressed there was still "a long way" to go. | |
| He said about 15 issues had still to be resolved between the two sides. | |
| Republican senator Mitch McConnell said the goal was to announce an agreement on Sunday and to have a vote on Monday. | |
| Negotiators want to have the outline of a deal to reassure the markets before they reopen on Monday. | |
| During a rare Saturday session of the upper house, Mr Reid, the Senate majority leader, said congressional staff had worked on the legislation for the bail-out plan until the early hours of the morning. | |
| Meanwhile, President George W Bush used his weekly radio address to try and reassure those Americans concerned about the burden on taxpayers of the deal, saying the package would end up costing less than the headline figure of $700bn. | |
| Compromises | Compromises |
| Optimism about the chances of a deal grew after Democrats made a key concession on Friday. | Optimism about the chances of a deal grew after Democrats made a key concession on Friday. |
| We hope sometime [Sunday] evening we can announce there has been some kind of agreement in principle so that the only thing that will have to be done is the legislation Democrat Senator Harry Reid Rescue deal stalemateBail-out: the sticking pointsMore cash injected into banks | |
| Democratic House of Representatives Speaker Nancy Pelosi told a private meeting of Democrats that they would no longer be pursuing their proposal to amend the bankruptcy laws to allow judges to suspend repossession notices on foreclosed homes. | Democratic House of Representatives Speaker Nancy Pelosi told a private meeting of Democrats that they would no longer be pursuing their proposal to amend the bankruptcy laws to allow judges to suspend repossession notices on foreclosed homes. |
| Republicans had feared that such a move would discourage banks from issuing new mortgages. | Republicans had feared that such a move would discourage banks from issuing new mortgages. |
| And in a further a sign of movement, the House Republicans, who have expressed the strongest opposition to the emerging deal, dispatched their second-ranking leader, Roy Blunt, to join the talks. | And in a further a sign of movement, the House Republicans, who have expressed the strongest opposition to the emerging deal, dispatched their second-ranking leader, Roy Blunt, to join the talks. |
| The Bush administration appeared to move to appease its Republican opponents by agreeing to include - but only as an option - their proposal to insure distressed mortgage bonds rather than buying them outright from Wall Street firms, the centrepiece of the government's proposal to unfreeze the financial markets. | The Bush administration appeared to move to appease its Republican opponents by agreeing to include - but only as an option - their proposal to insure distressed mortgage bonds rather than buying them outright from Wall Street firms, the centrepiece of the government's proposal to unfreeze the financial markets. |
| Blame game | Blame game |
| During a live TV debate on Friday, both Republican Senator John McCain and Democrat Senator Barack Obama endorsed the need for a compromise plan. | |
| But their responses also revealed differences over who was to blame for the crisis. | But their responses also revealed differences over who was to blame for the crisis. |
| "We also have to recognise that this is a final verdict on eight years of failed economic policies promoted by George Bush, and supported by Senator McCain," Senator Obama said. | "We also have to recognise that this is a final verdict on eight years of failed economic policies promoted by George Bush, and supported by Senator McCain," Senator Obama said. |
| Senator McCain, meanwhile, blamed the crisis on irresponsible leadership in Washington and Wall Street, and said he would consider a freeze on non-military spending to pay the costs of the bail-out. | Senator McCain, meanwhile, blamed the crisis on irresponsible leadership in Washington and Wall Street, and said he would consider a freeze on non-military spending to pay the costs of the bail-out. |
| Voter worries | Voter worries |
| Congressmen of both parties are anxious to get back to their constituencies in order to fight the election which takes place on 4 November. | Congressmen of both parties are anxious to get back to their constituencies in order to fight the election which takes place on 4 November. |
| But they are also worried by growing evidence that most Americans are sceptical about the bail-out deal, and especially about how much it will cost | But they are also worried by growing evidence that most Americans are sceptical about the bail-out deal, and especially about how much it will cost |
| The latest opinion poll, from the Associated Press-Knowledge Networks, taken on Friday, showed that only 30% expressed support for the bail-out package, while 45% were opposed and 25% undecided, despite the dramatic appeals of President George W Bush and Treasury Secretary Henry Paulson that the move was necessary to save the US economy. | The latest opinion poll, from the Associated Press-Knowledge Networks, taken on Friday, showed that only 30% expressed support for the bail-out package, while 45% were opposed and 25% undecided, despite the dramatic appeals of President George W Bush and Treasury Secretary Henry Paulson that the move was necessary to save the US economy. |
| The widespread public opposition is one reason that the Congressional leadership wants a bi-partisan deal before they are prepared to put the proposals to a vote. | The widespread public opposition is one reason that the Congressional leadership wants a bi-partisan deal before they are prepared to put the proposals to a vote. |
| They do not want to face the voters unless they can show that Congress acted on a united front because of the urgency of the crisis. | They do not want to face the voters unless they can show that Congress acted on a united front because of the urgency of the crisis. |
| Market wobbles | Market wobbles |
| Financial markets have been nervously watching the ebb and flow of the bail-out negotiations. | Financial markets have been nervously watching the ebb and flow of the bail-out negotiations. |
| On Friday, European markets fell, but rumours that negotiations had resumed boosted stocks on Wall Street, where the Dow Jones average of leading shares finished in positive territory. | On Friday, European markets fell, but rumours that negotiations had resumed boosted stocks on Wall Street, where the Dow Jones average of leading shares finished in positive territory. |
| Meanwhile, central banks injected liquidity into the financial system to prevent inter-bank lending from seizing up, with the US Federal Reserve taking the lead by organising swaps with other central banks across the world, including Japan, the UK, Switzerland, and Australia. | Meanwhile, central banks injected liquidity into the financial system to prevent inter-bank lending from seizing up, with the US Federal Reserve taking the lead by organising swaps with other central banks across the world, including Japan, the UK, Switzerland, and Australia. |
| Do you work in the banking or finance industry? Contribute to our Experts Forum here. | Do you work in the banking or finance industry? Contribute to our Experts Forum here. |