In legislation released Sunday, Republican lawmakers proposed increasing a Treasury Department fund that would be used to cover losses on the Fed’s emergency lending programs. “We can lever up to $4 trillion to help everything from small business to big business get through the next 90 to 120 days as we win this war,” he said on Fox News. During the 2008 financial crisis, the Fed used its emergency lending powers to inject money into Bear Stearns and American International Group, which were on the verge of collapse. The programs drew such intense political backlash that Congress, in the 2010 Dodd-Frank law, stripped the central bank of the ability to bail out specific institutions. Emergency programs must now be broadly available, meaning they could be tapped by five or more institutions, but even so, the Republican proposal was drawing opposition from Democrats on Sunday.

Source: International New York Times March 22, 2020 22:30 UTC