Felix Salmon

Geithner in the hot seat

By Felix Salmon
January 8, 2010

The New York Fed has announced that its decision to try to squelch AIG disclosures had nothing whatsoever to do with Tim Geithner. Who was the president and CEO of the bank at the time, and is famous for his attention to detail. But Geithner had every opportunity, both at the Fed and at Treasury, to agitate for greater transparency and for the release of even more emails. He never did so, and my feeling is that if nobody asked him about the AIG disclosures it was because there was no need to do so: his attitude to such things was clear.

It’s going to be very interesting to see Geithner’s congressional testimony on this subject. The Fed statement hints at one of those “I had no idea what my subordinates were doing” defenses, which is going to look pretty bad. But what alternative does he have? “The US public couldn’t handle the truth”?

5 comments so far | RSS Comments RSS

I tried picturing Geithner reciting Jack Nicholson’s speech in A Few Good Men, and it just didn’t compute.

I vote for alternative #1: looking clueless and out of touch.

Posted by EpicureanDeal | Report as abusive

Geithner is a lying thug criminal in a suit. He is the bought and paid for puppet of Goldman Sachs and JP Morgan Chase.

That he was appointed secretary of the treasury is a testament of just how corrupt the USA has become.

Just like his buddy federal reserve Bernanke, they both break the law and abuse the power of their office on a daily basis.

Federal law enforcement is a bad joke the FBI and DOJ know what is going on, but they have orders all the way from the top to do nothing.

We will probably have one last hurrah before the dollar, the economy, and confidence collapse because of these crooks who have been lying and stealing from the beginning.

Fire Bernake and Geithner, break up the big banks, punish these crooks, and bring back investor confidence before it’s too late!

Posted by bigkirb1 | Report as abusive

Geithner is toast. When a cabinet secretary commences becoming a liability for the WH, guess who survives? They have now had to express “confidence” in him two or three times in less than a year. BYE BYE, Timmy.

Posted by djackson | Report as abusive

Two of Obama’s worst personnel decisions were to hire Geithner as Treasury Sec. and nominate Bernanke for a new term as head of the Fed. While they are not solely responsible for the meltdown, they were on the job when it happened. I find it hard to believe there is nobody else available for these jobs who don’t share some of the responsibility for the mistakes of the Fed.

I can appreciate that there was a need to prevent panic from spreading back in 2008 when AIG’s bets were covered by the Fed, but that information wasn’t being withheld from the public – what was kept secret were the recipients of the bailout, and that information wouldn’t have caused further panic, only anger, and it might have forced Goldman and the other firms to actually negotiate with AIG and the Fed. These two guys played a huge role in the very inefficient rescue of the financial system (I’m not saying it shouldn’t have been done, only that it could have been done for a lot less), and should not be rewarded with their current positions.

Posted by OnTheTimes | Report as abusive

Yes that is true, both Geithner and Bernanke choices are wrong at this time. Here is what I would like Obama WH to undertake:
- Geithner to resign immediately (you can not wait for Dodd to fill that post by year end, besides that will be too opportunistic for Dodd)
- Obama appoints a special Congressional committee with two objectives: one to rewrite charter / mandate of Fed and to find replacement to Bernanke, the new appointee who would implement that charter.
- Bernanke withdraws his nomination and Congress allows him to stay until new person comes along in next few months.
- The committee to rewrite Fed will be those who are doing Financial Regulation. But the key is it needs to include Ron Paul, Eric Cantor, Barney Frank, Nancy Pelosi, Christopher Dodd, Charles Schummer, John McCain and Harry Reid. Clearly unless the issue of ‘Fed rewriting’ is pulled beyond partisan pressurse, it will be not be delivered good for America.
- This Congressional Committee would have 3 external advisers to devise new Fed: Paul Krugman, Paul Volcker and Simon Johnson.
- Contrary to what some news magazine says, there should not be any Wall Street Banker to replace Geithner. Jamie Dimon of JPM should not be the next Treasury Sec. The whole point of this ‘mini revolution’ is to set new foundation for America where Bankers do not ‘eat we Americans alive’.
- Bernanke needs to go because of his speech this week in Atlanta where he essentially absolved himself from this Great Recession. When President wants to give ‘big lectures’ about accountability of intel folks; it does not work he lets go Bernanke accountability free and Geither off the hook of the employment mess.
- Bernanke has done is job, he has got his applause and now we no more want any further damages from him. Time to stop his is NOW.
- Anything short of this ‘mini revolution’; Dems will be and should be ‘toast’ in Nov election and Obama may be one term President too. He will deserve that unless he cleans this mess NOW.

Posted by umeshgeeta | Report as abusive

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