Neel Kashkari was sworn in as Assistant Secretary of the Treasury for International Economics and Development on July 9, 2008.
I guess you need an international background to distribute all that money to the foreign banks.
Why am I not surprised that he came from Goldman Sachs?
Officials pledge to move quickly on rescue
Monday October 6, 2:28 pm ET
By Martin Crutsinger and Jeannine Aversa, AP Economics Writer Administration, pledging to move quickly, release details on selecting rescue managers
WASHINGTON (AP) -- The Treasury Department moved swiftly Monday to implement the financial rescue package, naming a former Goldman Sachs executive
to oversee spending the $700 billion earmarked for the plan and pledging to work with other countries to calm global financial markets.
The administration announced it had tapped Neel Kashkari, 35 -- an assistant Treasury secretary for international affairs -- to head the Treasury's new Office of Financial Stability on an interim basis.
Kashkari helped draft the legislation as one of Treasury Secretary Paulson's close advisers on the crisis. Kashkari joined the government after working at Goldman Sachs, the firm Paulson headed before joining the Bush administration in 2006.
The President's Working Group on Financial Markets, which includes Paulson and Federal Reserve Chairman Ben Bernanke, said it would move "with substantial force on a number of fronts" to implement the expanded authorities granted to the government when Congress passed the emergency rescue package last Friday.
President Bush's top economic advisers also vowed to work with their counterparts around the world to restore confidence and stability to financial markets roiled by tight credit and worries about a global economic slowdown.
Officials made a number of rapid-fire moves Monday in an effort to demonstrate that the government would not tarry in implementing the new program.
Investors were not reassured. Stocks tumbled, joining a sell-off around the world as fears grew that the financial crisis will cascade through economies globally despite bailout efforts by the U.S. and other governments.
President Bush, speaking in San Antonio, said the rescue package was designed to unlock the nation's frozen credit markets "to get money moving again" through the economy. But he added, "We don't want to rush into the situation and have the program not be effective."
In one of the moves Monday, the Treasury Department released a set of guidelines for selecting the financial asset management firms that will run the program and for guarding against conflicts of interest.
European governments took steps to limit the damage from the growing global financial crisis. Among other things, the governments of Germany, Ireland, Greece and Denmark said they would guarantee bank deposits.
In a fresh effort to loosen dangerous credit clogs, the Federal Reserve said it will significantly expand its loan program to squeezed banks, increasing one program to as much as $900 billion by the end of this year.
The Fed also said it will begin paying interest on commercial banks' reserves, another way to expand the Fed's resources to battle the worst credit crisis in decades.
Congress in the $700 billion bailout bill President Bush signed on Friday gave the Fed the power to pay interest on those reserves for the first time. The law accelerated the effective date to October of this year versus in 2011. That will encourage banks to keep more resources at the central bank.
Treasury said Monday that it would expand the size of its upcoming debt auctions to handle the increased borrowing needs to fund the $700 billion bailout effort, which is expected to buy about $50 billion in troubled assets each month. The department announced that it would auction $100 billion in short-term debt known cash management bills later this week.
Treasury also said it was considering bringing back the three-year note besides expanding the size of other debt auctions.
The statement from the president's working group laid out a number of initiatives that the Treasury, the Fed and other government regulators including the Federal Deposit Insurance Corp. would be undertaking.
"The diversity of institutions and markets under stress, and the magnitude and complexity of the adjustment under way, requires that the tools available to policymakers, regulators and supervisors be used in forceful and coordinated ways across regulatory and supervisory agencies in the United States and throughout the world," the working group said in its statement.
Over the weekend, governments across Europe rushed to prop up failing banks. The German government and financial industry agreed on a $68 billion bailout for commercial-property lender Hypo Real Estate Holding AG, while France's BNP Paribas agreed to acquire a 75 percent stake in Fortis' Belgium bank after a government rescue failed.
The Dow Jones industrials skidded around 600 points and fell below 10,000 for the first time in four years, while the credit markets remained under strain.
Broader indexes also tumbled. The Standard & Poor's 500 index shed 6.56 percent, the Nasdaq composite index fell 7.24 percent, and The Russell 2000 index of smaller companies dropped 6.69 percent.
Global markets sold off, too. Tokyo's Nikkei 225 index fell to its lowest level in 4 1/2 years, sinking 4.25 percent to 10,473.09. Hong Kong's Hang Seng index slid 5 percent to 16,803.76. Markets in mainland China, Australia, South Korea, India, Singapore and Thailand also dropped sharply.
At the close, Germany's DAX fell 7.1 percent, the FTSE 100 index in Britain slipped 7.9 percent and France's CAC-40 dropped 9.0 percent.
The anxiety was again obvious in the credit markets. The yield on the three-month Treasury bill slipped to 0.42 percent from 0.50 percent late Friday. Demand for bills remains high because of their safety; investors are willing to take extremely low returns just to have their money in a secure place.
Associated Press Business Writers Joe Bel Bruno in New York and Pan Pylas in London contributed to this report.http://biz.yahoo.com/ap/081006/meltdown_administration.html?.v=14