Key lawmakers are set to meet again on Wednesday morning in both houses of Congress, eager to show a freaked out Wall Street that the House and Senate will approve a bailout bill soon, maybe by the end of the week.
A number of items were being floated for possible inclusion in the bailout bill, which supporters now want to refer to as a “rescue” bill.
Maybe they should have thought of that a bit earlier, before public opinion went against the $700 billion plan.
Most likely to be in the new and improved bailout bill is a provision that Democratic leaders evidently refused to sign off on in the original round of negotiations with the White House, that being a plan to raise the limit on government insurance of bank deposits.
You know it by the familiar “FDIC” – the Federal Deposit Insurance Corporation. It insures you up to $100,000. For most people that’s fine, but lawmakers say it hurts small businesses who might have more than that in a financial institution that could go belly up.
Raising that limit, the argument goes, would keep people from wildly pulling their deposits out of troubled banks, as those kind of bank runs only cause more trouble for the institution.
Another item is something that I won’t even try to explain in depth – you can look it up on the internet. It deals with accounting rules, so called “mark to market” accounting standards.
The rules basically force companies to mark down the value of “impaired” assets, like foreclosed homes, which won’t sell for their original price.
Backers want those rules eased, so that the balance sheets of a bank look better, thus freeing them to be able to lend more money.
This one is complicated, because consumer groups oppose the idea, as do some accounting groups.
Regardless of that argument, it’s clear that negotiators are looking at some different ideas, and that is a good thing, since many lawmakers in both parties have complained about the rushed process on Capitol Hill.