"Moment of truth" for US bad bank; China to "show flexibility" on protectionism; Likud and Labor begin coalition talks; world's cheapest car; and more

Top of the Agenda: U.S. Bank Plan

The Financial Times reports this morning could be a "moment of truth" for the Obama administration as Treasury Secretary Timothy Geithner unveils a new plan to get bad assets off the books of U.S. banks. The Wall Street Journal, which interviewed Geithner about the plan on Sunday, reports the government will lean heavily on the private sector for help in its efforts. The Journal says Geithner has planned a "three-pronged program" that facilitates public-private investments aimed at soaking up $500 billion to $1 trillion worth of troubled loans and securities. The paper reports taxpayers, along with private investors, will stand to make gains if the investments ultimately prove profitable. The FT says the success of the plan will determine whether the "besieged" Obama administration "regains full credibility in its handling of the financial crisis."

The New York Times reports that market indices in both Asia and Europe rose today on hopes that the plan will effectively spur lending to consumers and companies.

Meanwhile, the Washington Post reports some Obama administration officials have reacted coolly to congressional actions to recoup bonuses to financial sector executives through punitive taxes. The U.S. House of Representatives last week passed legislation that would levy a 90 percent tax on some bonus payments.

PACIFIC RIM: China's Trade Stance

China Daily reports Beijing's Commerce Minister Chen Deming has signaled it will be flexible on some "sensitive issues" at global talks to stem the tide of trade protectionism. Specifically Chen said China would "show flexibility on issues like the Agricultural Special Safeguard Mechanism" in an effort to boost multilateral trade talks.

In a recent CFR meeting, three experts discuss the global trade implications of the financial crisis.

S.KOREA: Seoul unveiled a new program (Yonhap) aimed at bolstering the economic prospects of South Korea's working middle class.

Elsewhere:

Israel's Likud party begins coalition talks with Labor.
Turkish president to meet with Iraqi counterpart.

India commences sales of world's cheapest car.

This is an excerpt of the CFR.org Daily News Brief. The full version is available on CFR.org.