Geithner: Emergency Powers Needed ASAP

Treasury secretary Timothy Geithner is urging Congress to move "as quickly as you can" to pass legislation that would allow the government to place bank holding companies and non-bank financial firms into conservatorships managed by the Federal Deposit Insurance Corp. or provide those troubled firms with financial assistance. Secretary Geithner told a congressional panel the Treasury Department needs additional powers to deal with firms like American International Group to prevent financial meltdowns. "We are still in the midst of a very challenging period. I think it would be in the interest of the country for Congress to do everything they can to make sure we have board tools and manage this effectively," he said. Under legislation proposed by the Obama administration, Treasury would receive positive recommendations from the FDIC and the Federal Reserve Board before seizing troubled hedge funds or life insurance companies. "Depending on the circumstances, the FDIC and Treasury would place the firm into conservatorship with the aim of returning it to private hands or receivership that would manage the process of winding down the firm," the Treasury secretary testified.