Treasury Secretary Henry Paulson said the department's Troubled Asset Relief Program would begin to focus more on relieving tight consumer credit markets and shift away from the original plans to buy mortgage-backed securities.
Paulson acknowledged that the plan he pitched to lawmakers for the Treasury to buy up hard-to-value assets that were clogging bank balance sheets was essentially a non-starter even before Congress approved the financial rescue package. Instead, he and his colleagues decided that the best course of action was to inject capital directly into banks by purchasing preferred stock.
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