In his latest move to shore up the faltering U.S. economy, U.S. President Barack Obama on Wednesday announced a $75 billion plan to help millions of homeowners facing possible foreclosure.
The plan is meant to help people restructure or refinance their mortgage loans so monthly payments are more affordable. The government will subsidize modified loans to help avoid foreclosure in some cases where homes have lost value.
The U.S. Commerce Department announced Wednesday that the number of new homes under construction fell to a record low last month. And officials at the U.S. central bank, the Federal Reserve, said overall the nation's economy will shrink between half a percent and 1.3 percent this year.
The former chief of the Federal Reserve, Alan Greenspan, told the "Financial Times" newspaper that "temporarily" nationalizing banks may be the only way to restore confidence in the financial system.
The future of the U.S. auto industry is also still uncertain, a day after General Motors and Chrysler presented restructuring plans in hopes of getting more government aid. Standard and Poor's rating agency said Wednesday that both automakers could collapse for lack of consumer demand.GM and Chrysler have asked the government for a combined total of $14 billion in additional loans, on top of initial sums they received late last year.