Geithner Extends TARP To October
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Treasury Secretary Timothy Geithner sent a letter to Congress on TARP outlining the Obama Administration's plans to extend the program until October 3, 2010. Geithner also outlined the administration's exit strategy for TARP.
Set to expire on December 31, the Troubled Asset Relief Program can be extended by Geithner after notifying Congress of the need. A letter from the Treasury Secretary to Congress regarding TARP came early on Wednesday.
"As a result of improved financial conditions and careful stewardship of the program, losses on TARP investments are likely to be significantly lower than previously expected," Geithner said. "As a result, we expect that TARP will cost taxpayers at least $200 billion less than was projected in the August Mid-Session Review of the President's Budget."
Geithner went on to point out that significant challenges to the recovery still remain. American families, homeowners, and small businesses continue to face "severe" financial conditions. Forclosures are on the rise, while the unemployment rate is unnervingly high.
Geithner commented on the current progress of the economic turnaround by saying that "the recovery of our financial system remains incomplete."
The letter to Congress states an exit strategy for TARP as the government will continue to wind down the stimulus programs that were put in place after the economic meltdown. Much of the money invested in the banking system is set to be repaid as financial institutions will soon have given back $116 billion that was lent out.
The government will focus on three main areas of interest in 2010 including foreclosures, the health of small and community banks, and improving securitization markets that facilitate consumer and small business loans, as well as commercial mortgage loans.
Geithner concluded by stating that beyond these issues that remaining TARP money will not be used unless an immediate and substantial threat to the economy shows itself.
Set to expire on December 31, the Troubled Asset Relief Program can be extended by Geithner after notifying Congress of the need. A letter from the Treasury Secretary to Congress regarding TARP came early on Wednesday.
"As a result of improved financial conditions and careful stewardship of the program, losses on TARP investments are likely to be significantly lower than previously expected," Geithner said. "As a result, we expect that TARP will cost taxpayers at least $200 billion less than was projected in the August Mid-Session Review of the President's Budget."
Geithner went on to point out that significant challenges to the recovery still remain. American families, homeowners, and small businesses continue to face "severe" financial conditions. Forclosures are on the rise, while the unemployment rate is unnervingly high.
Geithner commented on the current progress of the economic turnaround by saying that "the recovery of our financial system remains incomplete."
The letter to Congress states an exit strategy for TARP as the government will continue to wind down the stimulus programs that were put in place after the economic meltdown. Much of the money invested in the banking system is set to be repaid as financial institutions will soon have given back $116 billion that was lent out.
The government will focus on three main areas of interest in 2010 including foreclosures, the health of small and community banks, and improving securitization markets that facilitate consumer and small business loans, as well as commercial mortgage loans.
Geithner concluded by stating that beyond these issues that remaining TARP money will not be used unless an immediate and substantial threat to the economy shows itself.
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