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Obama to set conditions for banks Obama to set conditions for banks
(about 1 hour later)
President Obama has asked Treasury Secretary Timothy Geithner to compile a set of guidelines for banks receiving taxpayers' money.President Obama has asked Treasury Secretary Timothy Geithner to compile a set of guidelines for banks receiving taxpayers' money.
"If a bank or a financial institution is getting relief then they've got to abide by certain conditions," he said in an interview with NBC News."If a bank or a financial institution is getting relief then they've got to abide by certain conditions," he said in an interview with NBC News.
The president has been critical of bank executives receiving bonuses despite taking government bail-outs.The president has been critical of bank executives receiving bonuses despite taking government bail-outs.
He also said that "some banks won't make it" through the current crisis.He also said that "some banks won't make it" through the current crisis.
"The banks, because of mismanagement, because of huge risk-taking, are now in a very vulnerable position," he said."The banks, because of mismanagement, because of huge risk-taking, are now in a very vulnerable position," he said.
"We can expect that we're going to have to do more to shore up the financial system.""We can expect that we're going to have to do more to shore up the financial system."
Stimulus packageStimulus package
The interview was short on details with the president declining to comment on whether he planned to create a "bad bank" to buy toxic assets from other financial institutions.The interview was short on details with the president declining to comment on whether he planned to create a "bad bank" to buy toxic assets from other financial institutions.
He said that he did not want to pre-empt an announcement planned for "next week".He said that he did not want to pre-empt an announcement planned for "next week".
The president and Vice President Joe Biden are due to meet congressional leaders later on Monday to encourage them to move forward on an $800bn (£567bn) economic stimulus package.The president and Vice President Joe Biden are due to meet congressional leaders later on Monday to encourage them to move forward on an $800bn (£567bn) economic stimulus package.
He said he was confident that Republicans would be able to support the final version of the legislation, although it passed in the House of Representatives without a single Republican vote.He said he was confident that Republicans would be able to support the final version of the legislation, although it passed in the House of Representatives without a single Republican vote.
The plan will be scrutinised by the Senate this week.The plan will be scrutinised by the Senate this week.
It is unlikely that it will be able to pass the Senate without Republican support because the Democrats do not have the majority that they would need to vote down any potential delaying tactics.It is unlikely that it will be able to pass the Senate without Republican support because the Democrats do not have the majority that they would need to vote down any potential delaying tactics.
Economic woes
President Obama's comments came as fresh official data indicated the problems facing the wider US economy show no signs of lessening.
US consumer spending fell for a sixth consecutive month in December, according to the Commerce Department.
Although the decline was expected, the 1% drop was worse than the 0.9% contraction predicted by analysts.
Meanwhile, construction spending fell for a third month in a row in December, dropping 1.4%.