Paulson Sees Credit Crisis Easing - TheStreet

Paulson Sees Credit Crisis Easing

The Treasury secretary said 'the worst is likely to be behind us' but warned 'bumps along the road' remain.
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Treasury Secretary Henry Paulson said the "worst is likely to be behind us" in the lingering credit crunch in an interview published Wednesday in

The Wall Street Journal

.

Paulson said it would take several months more to sort out the full effects of the credit markets' disruptions that began last summer and further "bumps along the road" remain, the

Journal

said.

But he pointed to actions by the

Federal Reserve

-- including the central bank's aid to

JPMorgan Chase

(JPM) - Get Report

in buying a near-bankrupt

Bear Stearns

(BSC)

in March and unprecedented actions to provide liquidity to commercial and investment banks -- as soothing to the markets, the paper said.

On the political front, Paulson urged Congress to approve legislation improving the regulation of government-sponsored mortgage lenders

Fannie Mae

(FNM)

and

Freddie Mac

(FRE)

, the

Journal

reported.

That comes as the White House signaled it would veto a bill sponsored by Democrats that would provide Federal Housing Administration insurance for $300 billion in troubled mortgages.

Treasury also met with about 10 home lenders, including

Countrywide Financial

(CFC)

,

Bank of America

(BAC) - Get Report

and

Citigroup

(C) - Get Report

to urge them to standardize voluntary procedures for helping qualified borrowers modify existing mortgages into more affordable terms, the

Journal

reported Tuesday.

This article was written by a staff member of TheStreet.com.