--After getting raked across the coals on television all day, Sec. Geithner's performance today is now being given as the reason for the tank in the Dow today -- 400 points last time I looked. Sec. Geithner looks to have some broad ideas and little confidence, at a time when the expectation was that he'd have specific policies and some confidence that they'd work.
--I understand President Obama and Sec. Geithner's (et al) reason against just taking over the banks is that it would be politically tricky. Is what the Secretary, and by extension the President, are going through today any more politically palatable?
--Beside the unwillingness to just take over the problem organizations, the reason for the Secretary's poor showing is structural: the bad assets in question are that deeply illiquid. They have a de-stabilizingly low market value. At this point, Sec. Geithner doesn't want to pay market values, and he doesn't want to use federal money to pay above-market values. Being committed to do one or the other was necessary to having a fully formed plan today. He wasn't, there was no plan, and the whole operation lost credibility for it.
--Nationalization is the only option I see. They should get to work on it. President Obama is the most credible social force in the world today. Credibility is what the banks need. A perfect merger. Let Obama's administration run things, and may they be creative.
No comments:
Post a Comment