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Dump Geithner

MsExPat's picture

Go, read the long, detailed and terrific slow-boil takedown of Timmy by NYT investigative journalist Jo Becker and biz section whiz Gretchen Morgenson.

There were a lot of things here, but this section jumped out at me:

The New York Fed is, by custom and design, clubby and opaque. It is charged with curbing banks’ risky impulses, yet its president is selected by and reports to a board of directors dominated by the chief executives of some of those same banks. Traditionally, the New York Fed president’s intelligence-gathering role has involved routine consultation with financiers, though Mr. Geithner’s recent predecessors generally did not meet with them unless senior aides were also present, according to the bank’s former general counsel.

By those standards, Mr. Geithner’s reliance on bankers, hedge fund managers and others to assess the market’s health — and provide guidance once it faltered — stood out.

His calendars from 2007 and 2008 show that those interactions were a mix of the professional and the private.

He ate lunch with senior executives from Citigroup, Goldman Sachs and Morgan Stanley at the Four Seasons restaurant or in their corporate dining rooms. He attended casual dinners at the homes of executives like Jamie Dimon, a member of the New York Fed board and the chief of JPMorgan Chase.

Mr. Geithner was particularly close to executives of Citigroup, the largest bank under his supervision. Robert E. Rubin, a senior Citi executive and a former Treasury secretary, was Mr. Geithner’s mentor from his years in the Clinton administration, and the two kept in close touch in New York.

Mr. Geithner met frequently with Sanford I. Weill, one of Citi’s largest individual shareholders and its former chairman, serving on the board of a charity Mr. Weill led. As the bank was entering a financial tailspin, Mr. Weill approached Mr. Geithner about taking over as Citi’s chief executive.

But for all his ties to Citi, Mr. Geithner repeatedly missed or overlooked signs that the bank — along with the rest of the financial system — was falling apart. When he did spot trouble, analysts say, his responses were too measured, or too late.

That is one hell of a mis-placed "BUT" in the last graf!

ADDITIONAL NOTE: The NYT has put 658 pages of Geithner's daily agenda online, with notes. They're doing a Josh Marshall style mass-participation online investigative work, inviting readers to scan and add their comments.

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Submitted by jawbone on

have put aside for bonuses this year. Priorities. Personal wealth creation. More important than the working of the economy, perhaps even their own institutions. After all, they're too big to fail.

Surely more bailouts will be given if needed to keep them from failing? Gotta keep the transfer of wealth flowing from the less than uber-wealthy to the Uberwealthy class.

Party on.

(Or was it $38 Billion? Eh, billions here, billions there; pretty soon they'lll get it all....)

basement angel's picture
Submitted by basement angel on

But I do think there is a degree to which people like Geithner and Summers have it in their head that if they can just patch up the financial markets, then the economy will fall in line. And in truth, it almost certainly the exact opposite of that. That the economy may not fall in line threatens their wealth and stability as well - that's why I think there are some blindspots for these people.