02/13/09 Baltimore, Maryland I know we’re only three and a half weeks into the new administration. But I think it’s already time that informed lay people can start guessing how long Tim Geithner will last as Treasury Secretary.
I won’t take a position on this myself. I will instead marshal facts and evidence you can use to make your own guess in the comments section.
Let’s start with a piece in the International Herald Tribune, which surveys a host of establishment economists, all arriving at the same conclusion: Many of the major banks are insolvent, and Geithner’s TARP II plan — even once the details are fleshed out — will be inadequate to the task.
Hmmm… A Geithner brainchild that even by conventional, interventionist standards is a dud. Where’ve we encountered that before? Oh yeah, the decision to let Lehman go under last fall when Geithner was still head of the New York Fed.* Seemed like a good idea at the time, until it unleashed the Counterparty Cascade from Hell — nearly taking down AIG, forcing money-market funds to “break the buck,” and by some accounts bringing the U.S. financial system within three hours of meltdown.
Our next item of evidence is a report that Goldman Sachs called an emergency meeting of its biggest clients — hedge funds, private equity guys — on Tuesday after Geithner floated his TARP II turkey. Goldman first denied the meeting ever took place. Then it tried to spin the meeting as having been scheduled weeks in advance. Whatever the truth, clearly some of the meeting’s participants wanted it known they weren’t happy with the plan and strategically leaked the assertion that it was called at the last minute.
For someone who’s a Goldman guy through and through, Geithner doesn’t seem to be getting much of a vote of confidence here. No, Geithner’s never been on the payroll, but his designated chief of staff was a Goldman lobbyist, one of the board members of the New York Fed that Geithner used to run was a Goldman guy, and he’s a protege of uber-Goldman guy Robert Rubin.
So there’s the evidence, gleaned just from taking in my usual morning news diet. Again, I won’t take a stand on how long Geithner will last, although I strongly doubt he’ll be fired outright, which is why I call this the Geithner Resignation Pool; whenver the time comes we’ll get the usual song-and-dance about wanting to spend more time with family. So fire away with your own guesses about the timing.
* I’ve been misinterpreted on this before, so let me be clear: I’m a free-market guy who thinks all mismanaged banks should get what’s coming to them; better to purge the rot from the system and get it over with. I’m merely pointing out how Geithner blows it even using the yardstick of conventional bankster wisdom.
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Geithner will go down right after the Europeans announce that the Euro is to be the next world currency. That will be May/June 2009.
C.R. Coleman
B.A. Oklahoma.
I give him two weeks…Obama will have pin his economic failing on somebody
Timmy has no gravitas. And that clenched jaw delivery, and smug arrogance, really a turn off. I wonder–does he grind his teeth at night? And that apology before the Senate confirmation, really Timmy, full responsibility? For carelessness and poor attention? Fine, fine, that’s okay, here–take charge of the IRS.
I’m in. This pool is a no-brainer. Geithner is bleeding out from a foot-in-the-mouth wound. He can’t be saved.
I think it will take awhile as Obama seems to be a bit stubborn… assuming we don’t see a catacylsmic event (like a dollar meltdown ala Iceland) I say Monday October 19th 2009, Mega Black Monday. Put some gold & silver in your personal pool.
The people who pulled the power levers during the Boom are still in control. But most of the money people are no longer heeding their siren call. Once they lose control then Geithner will go. As far as timing, this meeting indicates that the reshuffling has started. Let’s just hope that the new ones coming in understand that prices have to fall to their natural levels in a natural way. This printing money is a serious mistake. Any leader who is truly “outside of the box” would have squashed this move in its infancy and then sat down with all the relevant parties and learned something before moving forward with a plan. If ANY money was to go out it should only have gone to those who during the high times played smart and saved. Established good relationships with their workers and the community. Most of these people (at the meeting) remember well the DRAGON of inflation and they don’t see the balance here. What could be worse than living in a country whose currency is worthless? Then everything is worthless. Playing with that just so a very small minority can keep up their current lifestyles?! Let’s get real here. That kind of insider abuse of the nation’s money is over. It took about 2000 years of practice (since Rome converted/ transformed from a Republic to an Empire) to pull off this last big party (Reagan to Bush II), but the energy is spent. The new days are coming.
Dear Sir
Tim Geithner a First class Ass and Doesn’t know what he’s doing or he’s following someone’s else order and trying to save the Banks&Insurance companys!
I think he isn’t 1/10 of what he’s suppose to be.Jim Cramer got it right weres he been and if he quite the market might go up 500points!And when he does speak he mumbles and says stuff that only make it worst!Kick Him Out!
Pretty prescient article here. The calls for his head grow louder by the minute.
Geithner may be a bright guy, but he might be best in the background- clearly not in the forefront, leading a significant government department. He’s quickly becoming a liability to the increasingly inept Obama Administration.