US government seeks ways to aid rest of financial sector

Senior officials are actively reviewing options to use authorities conferred by the $700bn rescue legislation to help these firms, which range from small consumer and business finance operations to large financial firms, such as GE Capital.

Even as they drew up plans for the bank rescue plan, US officials worried about the competitive impact it would have on the non-bank financial firms, which compete with banks for business.

They rejected an explicit blanket guarantee on all bank deposits (even though an implicit blanket guarantee now exists) because of the fear this would collapse the money market mutual fund sector, a core part of the non-bank financial system.

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