This is the VOA Special English Economics Report.
year ago, the United States financial system was in danger of collapse. One of
Wall Street's oldest investment houses had just sought protection from its
creditors. The Lehman Brothers bankruptcy on September fifteenth was a shock to
the system, but not the only one.
week earlier, the government had seized Fannie Mae and Freddie Mac. These companies
help finance most American housing loans. And one day after Lehman's failure,
the government decided that the huge insurer A.I.G. was too big to fail. The
Federal Reserve rescued the American International Group with an eighty-five
billion dollar loan.
But soon, credit markets around the
world slowed to a halt on fears about the health of banks. By early October, Congress
passed the Troubled Asset Relief Program, a rescue plan for the financial
Banks and other financial companies have
received more than two hundred billion dollars. But ten banks agreed in June to
repay almost seventy billion of that. And so far, the government has earned
about four billion on its investments.
But taxpayers still own almost eighty
percent of A.I.G. They also hold big shares of Citigroup and a number of other
banks, as well as sixty percent of General Motors.
On Monday, the anniversary of the Lehman
collapse, President Obama renewed his call for reform of financial supervision.
He said in a speech on Wall Street that some of the "old ways" that
led to the crisis have already returned.
BARRACK OBAMA: "That's why we need strong rules of
the road to guard against the kind of systemic risks we have seen. And we have
a responsibility to write and enforce these rules to protect consumers of
financial products, taxpayers, and our economy as a whole."
Chairman Ben Bernanke said Tuesday that the recession "is very likely over
at this point." But he said the labor market could remain weak through
week, leaders of the world's largest economies will meet in Pittsburgh,
Pennsylvania. They will discuss economic policies and ways to strengthen
financial regulation after the crisis. But the Group of Twenty summit also
comes as the United States and China face a growing trade dispute.
week the Obama administration placed high import taxes on Chinese tires. The
aim is to stop what American officials call a "harmful" increase in tire
imports. China, in turn, said this week that it will investigate imports of
American chicken products and auto parts. China also asked the World Trade
Organization to intervene, to avoid a trade war.
that's the VOA Special English Economics Report, written by Mario Ritter. I'm