03/18/2010 05:12 am ET | Updated May 25, 2011

Bankrupt Firms May Get Billions In Stimulus Subsidiies

WILMINGTON, Delaware (Reuters) - The U.S. government has provided more than $1 trillion of support to financial companies in a bid to keep credit flowing to the U.S. economy.

But a new law may give billions of dollars to bankrupt financial companies that will never make another loan. Instead of allowing lenders to keep credit flowing, these subsidies could mainly help hedge funds that buy distressed debt and equity.

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