Update on my piece from this morning, Time to Nationalize a Bank:
As I noted, Barney Frank, plans hearings on why the banks that have received bail-out assistance are refusing to lend, and why Paulson has been so reluctant to push the banks. Frank has now scheduled hearings for both November 12 and 18. He just put out this statement:
“I am deeply disappointed that a number of financial institutions are distorting the legislation that Congress passed at the President's request to respond to the credit crisis by making funds available for increased lending. Any use of the these funds for any purpose other than lending—for bonuses, for severance pay, for dividends, for acquisitions of other institutions, etc.— is a violation of the terms of the Act.
“I appreciate the fact that the Secretary of the Treasury has reemphasized that increased lending activity is the only legitimate purpose for taxpayer funding of these institutions. He must make it absolutely clear to any participating entity that the federal government will insist on compliance.
--Bob Kuttner
