Washington DC, MD (Marketsblog) – U.S. lawmakers have come up with a plan to rescue the financial system in the country from the persitent effects of the credit crunch.
The plan involves buying up to $700 billion worth of bad debt from ailing banks hit by the credit crisis, say published reports.
In return, the U.S. government gets a stake in these firms while executive pay at the banks will be curbed.
President Bush has expressed his approval of the rescue deal.
The plan is expected to be voted in this week, and if approved it will become the most severe intervention in the fiancial markets since the 1930s.
Nancy Pelosi, the Democratic Speaker of the House of Representatives said the message to Wall Street was that the "party is over," reports BBC News.