Wall Street's Eyes Swing Toward Washington

Wall Street's eyes turned toward Washington today as U.S Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke testified to the U.S. Senate about the ongoing crisis in the financial markets and urged immediate action on the $700 billion bailout plan.

While all the senators agreed that something must be done, some Democrats demanded more support for homeowners and a limit on executive pay. Republicans questioned the scope of the plan.

Maybe the most important thing to the stock market today was Bernanke, veering from his prepared remarks, shed some light on how assets will valued. Bernanke said buying assets from banks somewhere near 'hold-to-maturity' prices will protect bank balance sheets from unnecessary write-downs by providing a market price for the assets at the 'hold-to-maturity' price versus a 'fire-sale' price. Ben Bernanke said this will provide confidence to the system and bring back liquidity.

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