It will take socialism to save the American economy from unregulated Capitalism.

WASHINGTON (Reuters) - The U.S. Treasury Department plans to start directly injecting capital in U.S. banks as soon as the end of October in exchange for passive investment stakes, according to a financial policy source familiar with Treasury Secretary Henry Paulson's thinking.

Using authority granted to it by last week's $700 billion market rescue legislation, Treasury would get common or preferred shares in the banks it capitalizes, the source told Reuters on Thursday. The government does not intend to seek seats on companies' board of directors in the voluntary capitalization program.

White House spokeswoman Dana Perino said later on Thursday that Paulson is "actively considering" capital injections into troubled U.S. banks.

"Secretary Paulson is looking at all the different tools to figure out which ones should be used at what time and how robustly and how much money to put into each," she said.

A Treasury spokesperson declined to comment in detail but said: "Treasury has broad, flexible authorities under the financial rescue legislation to buy assets, provide guarantees and inject capital and intends to consider all of them."

Paulson is announcing the plan on TV right now.

No comments from the radical right about Bush's socialism rescue of unregulated Capitalism??

Errr Choux, the $700 Billion rescue package was voted in LAST week, so this is hardly current.

No, CB, Paulson announced *specifics* last evening. He announced the capitalization, the socializing of banks.