Movement on the Bailout Front

by Dollars and Sense

This could be pretty big news. From Reuters:

Bair says FDIC's powers could extend to insurers


Wed Oct 29, 2008 11:34am EDT

By Karey Wutkowski


WASHINGTON (Reuters) - The Federal Deposit Insurance Corp's powers could be expanded if Congress decides to shift insurance companies from state regulation to federal regulation, FDIC Chairman Sheila Bair said on Wednesday.


The FDIC could start providing guarantees for insurance companies, much like it already guarantees the deposits of most U.S. banks, if the insurance industry comes under federal regulation, Bair said. Insurance companies are currently regulated by individual states.


"Our authorities would be expanded," Bair said at the annual conference of the International Association of Deposit Insurers.


Read the rest of the article

Many people know about this already, but remember the pressure on the automakers. They want to get a (subsidized) deal done before the election next week, so an incoming government won't be able to tamper with it. But the deal is so complex it'll be extremely difficult to pull off. Sounds a bit like Bear Stearns, but in the non-financial, real-economy sector. From the Financial Times:


GM and Cerberus race to finalise Chrysler deal

By Bernard Simon in Toronto, Julie MacIntosh in New York James Politi in Washington, John Reed in London.
Tuesday Oct 28 2008 19:20


General Motors (NYSE:GM) and Cerberus Capital Management are racing to finalise a deal for the carmaker to acquire the private equity group's stake in Chrysler before next week's US election.


While many motor industry experts question the benefits of a tie-up between Detroit's number one and number three carmakers, they increasingly recognise that the companies have few other options. Both are bleeding cash and in danger of running out of liquidity some time next year as sales fall in their core US market.


Read the rest of the article

Labels: Cerberus Capital Management, Chrysler, FDIC, financial crisis bailout, GM, Sheila Bair

 

Please consider donating to Dollars & Sense and/or subscribing to the magazine (both print and e-subscriptions now available!).
10/29/2008 11:31:00 AM