Fed chief Ben Bernanke threw down the gauntlet and, like clockwork, all the lawmakers and officious officials hooting and hollering all the way to the floor vote on the first financial rescue package simply fell in line like good little soldiers. Even President Bush's press secretary allowed for his being “open to the idea,” like he's been sitting there waiting the whole time for someone to throw an apple at his head. Given that the alternative is more extreme financial pain for markets and consumers, it looks like they can't roll out the red carpet fast enough. But how many more bailouts and securities auctions will it take to make the system whole again? Here, the over-under on how the next shot of stimulus could be just enough to trigger a fresh wave of bank-led takeovers.

Lawmakers and officials moved toward forging a second fiscal stimulus bill after Federal Reserve Chairman Ben S. Bernanke endorsed the idea and the Bush administration dropped its opposition.

Bernanke warned legislators yesterday the credit crunch is "hitting home," with Americans unable to get auto loans and companies denied cash, and recommended measures to help borrowers. White House Press Secretary Dana Perino said President George W. Bush was "open to the idea" of a new stimulus.

Momentum for fresh measures built after an earlier stimulus package failed to prevent a jump in the unemployment rate to a six-year high and the longest slump in retail sales since at least 1992.

Bernanke "had to do what he did" in supporting a further federal stimulus measure, said Lyle Gramley, a former Fed governor who is now senior economic adviser at Stanford Group Co. in Washington. "If he went up there and said, `Well, I'm indifferent to a stimulus package, I'm opposed to it,' he would be sending the wrong signal."

House Budget Committee Chairman John Spratt said a new push would be patterned after earlier proposals made by House Speaker Nancy Pelosi that extend jobless benefits, fund infrastructure projects such as road and bridge construction, and help cash- strapped state and local governments.

Bernanke told the Budget Committee yesterday that the danger of a "protracted slowdown" and a "weak" outlook for the U.S. economy into next year convinced him to support a new round of economic stimulus. A similar endorsement by Bernanke earlier this year helped clear the way for a $168 billion measure enacted in February.

"The big development is that Bernanke came and said, in Fed-speak, `You'd be wise to consider this,"' Spratt, a South Carolina Democrat, told reporters after the hearing. "The momentum increased meaningfully because of Bernanke's endorsement."

Spratt said the package may have to be structured in a way that increases deficits in the short term to avoid a longer-term economic slump that would have bigger budget effects in the long run.

The Bush administration is "open to the idea" of another economic stimulus package, though approval would depend on details drafted by Congress, Perino said. Proposals "put forward so far" by Democratic leaders in Congress "were elements of a package we did not think would actually stimulate the economy, so we would want to take a look at anything very carefully," Perino said.

Separately, U.S. Treasury Secretary Henry Paulson said yesterday the government has set aside enough money to buy stakes in every financial company that qualifies for the crisis program aimed at halting the credit freeze. The New York Times and Wall Street Journal reported the government may use the aid to foster bank mergers, citing unnamed officials.

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