White House Expands Auto Bailout

The Treasury Department announced on Monday that $5 billion will go to GMAC, the financing arm of General Motors. The aid marks the latest effort to try to rescue the auto industry. After Congress failed to approve a $14-billion package earlier this month, President Bush agreed to give auto giants General Motors and Chrysler $17.4 billion in emergency loans from the $700 billion Troubled Assets Relief Program (TARP), which was established in October to help ailing financial institutions. The binding conditions established by the Treasury Department include that firms must comply with federal fuel efficiency and emissions requirements. U.S. stocks rallied today after news of the GMAC bailout, boosting hopes that the government would be able to limit the severity of the year-long recession. Read more in Reuters