Despite earlier rejection of a similar deal in the Senate, President Bush announced $13.4 billion in "emergency loans" to Chrysler and GM
, with another $4 billion on tap for February. "If we were to allow the free market to take its course now," the President said, "it would almost certainly lead to disorderly bankruptcy and liquidation for the automakers" -- which he said he wouldn't mind, ordinarily, but we're in the "midst of a financial crisis" and bankruptcy might make it worse. He said the loans would be "under conditions similar to those Congress considered last week" -- union givebacks, debt restructuring -- but "because Congress failed to make funds available for these loans," he'll take them from the TARP fund; if the carmakers don't present a "viable plan" by March 31, they have to pay the loans back. (Terms and interest were not discussed.)
Bush made his remarks at the start of trading and the market, expectedly, jumped 140 points in 90 minutes.