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Critical days ahead for US bailout plan

world Updated: Sep 27, 2008 23:18 IST
Jackie Frank

The US Congress and the Bush administration were under intense pressure on Saturday to negotiate a $700 billion rescue for the financial industry to free up frozen credit before world markets reopen after the weekend.

US House of Representatives Speaker Nancy Pelosi and President George W. Bush both expressed optimism on Friday that a deal could be reached soon to stave off the worst US financial crisis since the Great Depression.

“I believe that progress has been made,” said Pelosi, a California Democrat.

“We will not leave until legislation is passed. We will be working through the weekend to achieve that end.”

Early in the week there had been hopes for speedy approval of the plan by Congress, crafted by Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke and presented last weekend.

But conservative Republicans balked. With an eye to bring them on board, Democrats have now offered to add a mortgage insurance measure.