Kashkari: Markets 'fragile' But Improving

In his first formal congressional appearance since being tapped as bailout czar, Neel Kashkari said the government has made “tremendous progress” in implementing the $700 billion program but cautioned that the country’s financial markets remain “fragile.”

Despite a jittery stock market over the last several weeks, Kashkari said there have been: "numerous signs of improvement in our markets and in the confidence in our financial institutions."

Appearing before the Senate Banking Committee Thursday, Kashkari said the markets have responded positively to the government’s decision to inject capital into banks. However, he said that the real work of the program “is only beginning.”

FDIC head Shelia Bair also appeared before the panel.

In her testimony, Bair suggested that the government use its new authority from Congress to help struggling homeowners overhaul mortgages by giving banks incentives to modify the loans.