In testimony before the Committee on Oversight and Government Reform in Washington, DC, Neel Kashkari of the U.S. Treasury Department said he is committed to keeping the deployment of the TARP funds as transparent as possible.
"We have acted quickly and in coordination with the Federal Reserve, the FDIC, OCC and colleagues around the world to help stabilize the global financial system and it is clear that our coordinated actions have made an impact," Kashkari said in his opening remarks.
"Before we acted, we were at a tipping point. Credit markets were largely frozen, denying financial institutions, businesses and consumers access to vital funding and credit. Financial institutions were under extreme pressure, and investor confidence in our system was dangerously low."
He also said markets are stronger than they were just one week ago even though stress in asset-backed securities remains.
Kashkari also said the Treasury strongly believes institutions should utilize government funds, pointing to the stabilization of Fannie Mae and Freddie Mac, and adds that prudent bank lending will be the key to reviving economic growth in the country.
By Erik Kevin Franco and edited by Sarah Sussman
©CEP News Ltd. 2008