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'Great progress' in US bail-out | 'Great progress' in US bail-out |
(about 2 hours later) | |
US congressional leaders say they have reached the broad outline of a rescue plan for the American financial system. | US congressional leaders say they have reached the broad outline of a rescue plan for the American financial system. |
Democratic House Speaker Nancy Pelosi said "great progress" had been made - but details remain to be worked out. | Democratic House Speaker Nancy Pelosi said "great progress" had been made - but details remain to be worked out. |
The Bush administration wants $700bn (£380bn) to be able to buy bad debt that is freezing up financial markets. | The Bush administration wants $700bn (£380bn) to be able to buy bad debt that is freezing up financial markets. |
A vote could be held in the House of Representatives as early as Sunday, with negotiators keen to reassure the markets before they reopen on Monday. | A vote could be held in the House of Representatives as early as Sunday, with negotiators keen to reassure the markets before they reopen on Monday. |
The deal proposes that the government would spend the $700bn to buy up bad mortgage-related debts from US banks, borrowing the cash from the money markets by issuing more government debt. | The deal proposes that the government would spend the $700bn to buy up bad mortgage-related debts from US banks, borrowing the cash from the money markets by issuing more government debt. |
A White House spokesman welcomed the announcement and praised the efforts of the negotiators. | A White House spokesman welcomed the announcement and praised the efforts of the negotiators. |
"We're pleased with the progress tonight and appreciate the bipartisan effort to stabilise our financial markets and protect our economy," said Tony Fratto. | "We're pleased with the progress tonight and appreciate the bipartisan effort to stabilise our financial markets and protect our economy," said Tony Fratto. |
We've made great progress toward a deal which will be effective for all Americans Henry Paulson Bail-out debate: For and againstDeal sticking pointsQ&A: US $700bn bail-out plan | We've made great progress toward a deal which will be effective for all Americans Henry Paulson Bail-out debate: For and againstDeal sticking pointsQ&A: US $700bn bail-out plan |
The outline deal gives the treasury secretary powers to oversee the two-year plan, but critics have insisted on the inclusion of greater oversight and reporting. | The outline deal gives the treasury secretary powers to oversee the two-year plan, but critics have insisted on the inclusion of greater oversight and reporting. |
The BBC's Justin Webb in Washington says the tentative agreement that appears to have been reached is thought to include a measure to limit the pay for executives of companies which seek financial assistance, which was a key demand of the Democrats. | The BBC's Justin Webb in Washington says the tentative agreement that appears to have been reached is thought to include a measure to limit the pay for executives of companies which seek financial assistance, which was a key demand of the Democrats. |
At the request of Republicans, who have strongly criticised some elements of the administration's proposal, the accord is believed to include the setting up an insurance program for mortgage-backed securities. | At the request of Republicans, who have strongly criticised some elements of the administration's proposal, the accord is believed to include the setting up an insurance program for mortgage-backed securities. |
'All night' | 'All night' |
US Treasury Secretary Henry Paulson, who took part in the talks, said that Congressional leaders had been "working very hard". | US Treasury Secretary Henry Paulson, who took part in the talks, said that Congressional leaders had been "working very hard". |
"We've made great progress toward a deal, which will work and will be effective in the marketplace, and effective for all Americans," he told a news conference. | "We've made great progress toward a deal, which will work and will be effective in the marketplace, and effective for all Americans," he told a news conference. |
But Ms Pelosi said the deal had to be committed to paper before it could be formally agreed. | But Ms Pelosi said the deal had to be committed to paper before it could be formally agreed. |
Senate Democratic leader Harry Reid said Congress hoped to be able to make an announcement on the deal later on Sunday. | Senate Democratic leader Harry Reid said Congress hoped to be able to make an announcement on the deal later on Sunday. |
"We're committing it to paper tonight and our people will work all night long," he said. | "We're committing it to paper tonight and our people will work all night long," he said. |
Congressional leaders are trying to finalise the deal in time for the opening of the Asian markets on Monday morning. | Congressional leaders are trying to finalise the deal in time for the opening of the Asian markets on Monday morning. |
The BBC's Adam Brookes in Washington said: "In the coming days everyone will be looking at the credit markets, to see if banks are sufficiently relieved to start lending to each other again. | |
"The psychology of the markets is what everyone is waiting to see." |