FI showroom red and grey logo
MenuMENU
SearchSEARCH

Senate Passes Revised Bailout, Credit Remains Tight

After the addition of several incentives, the U.S. Senate voted to approve the $700 billion federal financial bailout package Wednesday, sending the measure back to the House of Representatives for a second vote Friday. Despite what appears to be good news for a frozen credit market, key lending rates and demand for Treasury securities remained at high levels Wednesday evening.

by Staff
October 1, 2008
2 min to read


WASHINGTON — After the addition of several incentives, the U.S. Senate voted to approve the $700 billion federal financial bailout package Wednesday, sending the measure back to the House of Representatives for a second vote Friday. Despite what appears to be good news for a frozen credit market, key lending rates and demand for Treasury securities remained at high levels Wednesday evening.

The bailout was designed to allow the federal government to buy failing mortgage-backed securities from financial institutions in order to defrost the credit market and avert further economic unrest. An earlier version fell to defeat in the House on Monday by a vote of 228 to 205.

Ad Loading...

Two thirds of House Republicans and one third of their Democratic counterparts voted against the bill, which lacked tax protections that conservative legislators had lobbied for over the weekend. Among other incentives, Senators added tax breaks and more than doubled the cap on federal deposit insurance from $100,000 to $250,000. The revised bill was approved by a vote of 74 to 25 and is set to return to the House on Friday.

Although proponents of the bill consider the Senate vote a good sign for further progress, credit markets remained tight through the close of business Wednesday. The Associated Press reported a consensus among large companies and lenders which were largely unmoved by the approval, reserving judgment for the conclusion of the House vote and beyond.

"It can only be effective if it marshals private confidence," Citigroup economist Steven Wieting told the AP. "Private credit markets, as of yesterday, in some ways have ceased to exist. ... This is a confidence crisis."

Highly leveraged companies continued to announce the suspension of planned expenditures, citing difficulty in obtaining credit lines. Investors continued the rush for Treasurys, a generally stable, government-issued security that serves as a key indicator for fears of inflation.

As House legislators prepared to reconvene, Senate leaders expressed optimism for the bailout's ultimate success, noting that the economy's time of need is at hand.

Ad Loading...

If the bill should become law, "There will be no balloons or bunting or parades," Sen. Chris Dodd, D-Conn., told the AP. But Congress, he said, would carry "the knowledge that at one of our nation's moments of maximum economic peril, we acted — not for the benefit of a particular few, but for all Americans."

Topics:F&I

More F&I

Woman in casual clothing sitting at a desk
F&Iby Rick McCormickMarch 31, 2026

Curb The Confusion

Talk to F&I customers like you’d talk to a friend, without industry lingo or sales-like questions, and use hard proof to show, not tell, them about a need.

Read More →
Photo of man's hand on laptop computer keyboard with blank screen
F&IMarch 16, 2026

There Is Always one More Product

Helping F&I customers understand complementary offerings is likely to lead to more sales, based on the success of a high-performing practitioner of the philosophy.

Read More →
REGISTER FOR EFI 2026
F&Iby Kate SpataforaMarch 16, 2026

EFI Conference Extends Early Bird Discount as Room Block Nears Capacity

Ethical F&I Manager's Conference will take place at The Cosmopolitan Las Vegas on April 13–15, 2026.

Read More →
Ad Loading...
Industryby StaffMarch 6, 2026

Explore the 12 Rules for an F&I Life at EFI

EFI 2026 will take place April 13–15 at The Cosmopolitan Las Vegas.

Read More →
F&IMarch 4, 2026

Creating Your Own Economy

In this video, Reese Dailey explains how effective follow-up drives better results across the dealership, including increased sales, higher F&I penetration, and stronger customer retention.

Read More →
Industryby StaffMarch 2, 2026

Prove You Can Do F&I at EFI

‘So You Think You Can Do F&I’ is a live role-play contest taking place at the 2026 Ethical F&I Managers Conference.

Read More →
Ad Loading...
Industryby Lauren LawrenceFebruary 25, 2026

Report Finds Year-End F&I Strength

Deal volume ebbed and flowed throughout 2025, but product performance remained steady, according to automotive technology and data intelligence solutions provider StoneEagle.

Read More →
Industryby Hannah MitchellFebruary 23, 2026

Some Auto Brands Cheaper to Insure

A new top 10 list ranks the least expensive for average full insurance coverage on a clean driving record and high driver credit scores.

Read More →
F&IFebruary 13, 2026

Business Office Blueprint

Try following these 20 steps to greater success in the dealer F&I office this year.

Read More →
Ad Loading...
Industryby Lauren LawrenceFebruary 11, 2026

Insurance Shopping on the Rise

A TransUnion study found that relationship-driven sales models proved to be important, as consumers who used an agent had a lower shopping intensity than those going it alone.

Read More →