Wednesday, April 1, 2009

EBR to Get Its Wish: Geithner Out?

Sometimes dreams do come true.

Geithner Out at the Treasury: Source

April 1, 2009 8:31 AM CST

Despite assurances to the contrary, President Obama has personally asked Treasury Secretary Timothy Geithner to step down, sources told HousingWire early Wednesday morning. Geithner, who has seen a whipsaw of public opinion over his handling of bonuses at American International Group(AIG: 0.98 -2.00%) and the introduction of a so-called public-private investment program designed to clear bad assets off of bank balance sheets, has been the subject of strong criticism from Republicans and even a few prominent Democrats.

The stunning move comes after Geithner’s popularity on Wall Street has gained momentum in the past week, as investors have largely cheered a proposal to see the Treasury, Federal Reserve, and FDIC partner with private investors to clear toxic assets off of of the hands of troubled banks.

“It’s being done quietly, but the President has asked Geithner to step aside,” said a source close to the Cabinet with knowledge of the decision. “He feels there is too much of a lack of trust, and he was frankly expecting more of a bounce in financial markets from the PPIP than what’s been seen so far.”

The Geithner-led Treasury has had difficulty filling key positions since his appointment. After the fourth potential senior Treasury roster nominee dropped from the running earlier this month, sources told the Washington Post that under-staffing issues might hamper the Treasury’s ability to handle the financial crisis.

Gus O’Donnell, Cabinet Secretary for the British government, suggested to various British media in recent weeks that it has been “unbelievably difficult” to talk to people at the U.S. Treasury, saying “there is nobody there.”

Let's see if the above, reported by Housing, is accurate or just a trial balloon that pops.

If it's true, and Paul Volcker comes in from the cold and takes over at least as interim Treasury Sec'y, one could expect a stock market pop as powerful but fleeting as those that greeted Michael Dell's and Howard Schultz's returns as CEO to Dell and Starbucks.

The worst news in the above would be if part of the reason for any dismissal of Mr. Geithner was that the stock market was not happy enough about the PPIP bailout plan for Citi and BofA.

The other worst news would be rehiring Hank Paulson or the equivalent.  What about someone on the side of the customers of Big Finance?

That would be change we could believe in!

Copyright (C) Long Lake LLC 2009

1 comment:

  1. Uh -- look at the links in the story. It was an April Fool's prank, and you've clearly been had!