The worst of the nation's credit crisis may have passed, Treasury Secretary Henry Paulson said Wednesday, though he acknowledged rising gas prices will blunt the effect of 130 million economic stimulus checks.

He ruled out a second stimulus package for now.

In an interview with The Associated Press, Paulson said the turmoil that has gripped Wall Street and that took a turn for the worse again in March has eased somewhat. "There's progress," he said. "I think we're closer to the end of this" than to the beginning.

A prolonged housing slump, a severe credit crisis and soaring energy costs have pushed the economy to the edge of a recession. To help cushion the blow, the Bush administration and Congress speedily enacted a $168 billion stimulus package of tax rebates for people and tax breaks for businesses.

(Article continues below)

With oil costs surging to record levels and gasoline prices hovering around all-time highs above $3.60 a gallon, Paulson acknowledged that pain at the pump would diminish the impact of the stimulus payments that are designed to give the economy a jump-start.

"Obviously, the high price of gasoline is unwelcome and is a challenge and is a headwind," he said.

The first batch of rebate payments started hitting bank accounts last week through direct deposits. Paulson, Vice President Dick Cheney and other Bush administration officials will head to government check printing centers around the country on Thursday for events highlighting the fact that millions of rebate checks are in the mail.

Full article here.