According to reports, if the US congressmen were to come back from Washington this week with the new US president's approval, US taxpayers or voters may by this week see the 2nd round financial rescue plans from the US government.
The last 168 billion worth of financial stimulus package was signed in February and the effect was not very prominent. The rescue plan this time if it were to come, the area of coverage may be wider and the 'strength' bigger.
The plan originally was estimated to need about 600 billion USD. It was later reduced down to 150 billion USD and later revised to about 300 billion USD, which is about 2% of US GDP. Although 300 billion USD is much lesser than the government's support for the finance department, but it is the largest sum in the recent economic stimulus packages.
The Wall Street Journal in US released a report on the 31 October 2008 mentioning that ending 2007, the top 9 banks that accepted the US government financial aids owed the senior management pension funds and deferred bonus payouts amounting to more than 40 billion USD. This means that part of the financial aid funds meant to help banks loosen the liquidity crisis may have ended up in the top management pockets.
The US House of Representatives Finance Committee Chairman Barney Frank says that funds meant to be used to save the market if used for other means, like for example paying Wall Street managers bonuses or pension funds will be a criminal act.
US Congress is now investigating the 9 banks top management year end bonus packages. The US government says that it is closely monitoring how the banks uses the financial aid funds and will make sure that they will not be mis-used.
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