U.S. Treasury undersecretary Anthony Ryan said the Federal Reserve will face unprecedented financing requirements in 2009 as it attempts to stabilize credit markets.
"This year's financing needs will be unprecedented. We firmly believe that investors value greatly and pay a premium for Treasury's predictable actions, the certainty of supply, and the liquidity in the market," said Ryan. "To the very best of our ability, we intend to stay the course."
Speaking in New York at the Securities Industry and Financial Markets Association Annual Meeting, Ryan said credit markets are still under "considerable strain" and that U.S. firms are have having a difficult time selling debt. Ryan said the U.S. treasury's aim is to keep borrowing patterns predictable.
Ryan added that the $250 billion dollar equity buying program is intended for "healthy banks." He said capital will be sent to nine major banks today.
Finally, Ryan reiterated that the U.S. government stands behind its guarantees on Government Sponsored Enterprises (GSEs), issued debt and all mortgage-backed securities.
By Steve Stecyk and edited by Sarah Sussman
©CEP News Ltd. 2008