U.S. planning to buy bank stocks.

[FeelinFroggy]

NEW YORK (CNNMoney.com) -- Treasury Secretary Henry Paulson said on Friday that the U.S. government was working on a plan to buy stock in financial institutions by using part of the $700 billion authorized by Congress to stabilize the financial system.

"We are working to develop a standardized program that is open to a broad array of financial institutions," Paulson said.

"Such a program would be designed to encourage the raising of new private capital to complement public capital," he said following a meeting of G-7 finance ministers and central bankers.

Any shares purchased by the U.S. government would be non-voting shares except, he said, "with the respect to the market standard terms to protect our rights as investors."

Paulson said that developing a standard program is the best way to "use taxpayer money more efficiently and have it go farther."

He didn't specify what the government's terms would be for companies that take part in the capital injection program.

"We're working as quickly as possible to unveil the capital plan," Paulson said. "We want to do it as soon as possible, but ... we want it to be right, and we want it to be effective. We're working around the clock."

Earlier this week, the United Kingdom said its Treasury would provide as much as $88 billion to eight big banks in need of capital.

The authority Congress granted to Treasury to use up to $700 billion to stabilize the financial system offers the Treasury a wide range of options, one of which will be to buy troubled assets from financial institutions so that they can get them off their balance sheet and start lending more freely again. But as with the stock purchase plan, exact details of how the troubled asset purchases will work haven't been finalized.

The stock market was thrashed this week as investors have been waiting to get more certainty on how the government's rescue plan will work. The credit markets, which have been seized up, showed a little loosening towards the end of the week but nothing to pop open the champagne over.

"They need the pricing details before there can be any sense of calm in the markets," said Jaret Seiberg, financial services analyst with The Stanford Group, a policy research firm.

First Published: October 10, 2008: 6:56 PM ET Comforting, huh?

http://money.cnn.com/2008/10/10/news/economy/paulson_capital_injection/index.htm

[PaulR]

Another step toward Socialism!:D

[HairyEyeball]

What nobody dares to admit (or cares to realize) is the fact that the original 'enabling legislation' was a 'gift' of LBJ's 'great society', reinforced during the Carter administration and brought to fruition by the Clinton administration and his Attorney General who effectively used force and the threat of force compelling lending institutions to extend loans and mortgages they knew would never be repaid...all of which is a matter of public record.

Also a matter of public record is the fact that for the first six years of the current administration, the economy grew (albeit not at a rate comparable to certain earlier eras), and the 'change' - precisely the one a certain candidate is advocating - coincided, just 'coincidentally', with a democrat majority taking over both Houses in the election of 2006. Further, the simple truths is that Congress, not the President, lards - er, writes - the budget, and while the President might desire tax cuts - or hikes, "All Bills for raising Revenue shall originate in the House of Representatives... (Article I, Section 7)". History demonstrates the party most likely to raise taxes, especially should the current majority remain, and especially under a socialist chief executive.

While McCain may have been a 'politician' too long to realize the impact of simple truths, there must be someone in his organization or in a leadership position who can elucidate these facts clearly enough for the 'average' voter to comprehend...whether or not the lamestream, drive-by media deigns to cover it.