Geithner's Unsurprising Decision To Stay At Treasury

Is anyone really surprised that tax-cheat and Treasury Secretary Tim Geithner has chosen to remain at Treasury for the rest of Wonderboy's term?

Friday's S&P downgrade of US credit from AAA to AA+ is probably not the note on which Geithner wants to end his Treasury career. To leave now would provide an air of, well, resignation. An admission of defeat.

Then there's the little matter of his replacement.

Sure, pundits were favoring Jamie Dimon to be Geithner's replacement. But, with Wonderboy's recent bumbling of the debt limit talks, and falling poll numbers with just a year and change to go before the 2012 election, does Dimon want to trade a fairly safe career as Chase CEO for as long as he wants for what could well be a one-year, highly-politicized tour at Treasury? Wouldn't the same be true for anyone in the financial community who is unsullied by the recent crisis, but smart enough to read the Tea (Party) leaves?

Face it, whoever follows Geithner, who was never more than a financial plumber by experience, will only be even more of a hack than he was. It's damage control time at Treasury with what will be, after confirmation of Geithner's replacement, just about 12 months to go before the election. And his/her prospects for a longer career than one year are highly in doubt.

So that left the administration with the possibility of an Undersecretary filling in for Geithner as it desperately tried to find someone respectable, or at least adequate, and potentially didn't succeed.

Can you imagine the US going without a Treasury Secretary for several months right after the nation's first credit downgrade?

My guess is that it was made clear to Geithner that his life after Treasury would be as nightmarish as Wonderboy and his allies could make it, should he unwisely desert the ship of state in its hour of need.

Wonderboy's Financial Plumber

As I discussed a wide range of topics, some business in nature, others political, with my friend B yesterday at lunch, the subject of tax cheat and Treasury Secretary Tim Geithner came up.

I lamented Geithner's wet noodle posture while "negotiating" with Goldman Sachs et. al. over paying them the full value due them from AIG for credit derivatives.

B mentioned conversations he has had with Fed officials who know Geithner. They characterized him as an operations guy. That is, a guy who knew how to run the financial plumbing of the Fed, meaning its various money transfer systems and such.

But nobody ever accused Geithner of being able to fill, let alone even shine, Paul Volcker's shoes. Volcker, you may recall, headed the New York Fed, before being chosen to become probably the most effective chairman of our central bank in its history.

Judging from his stumbles and misfires this year, it looks like my friend's information is correct. Geithner got fleeced by Wall Street CEOs, and, for that dismal performance, was rewarded with the job of Treasury Secretary.

No wonder we still have no sensible financial leadership in Washington.

The Left Hand & The Right Hand

I've been listening to Tax Cheat Treasury Secretary Tim Geithner give testimony before the Congressional TARP Oversight Committee this morning.

At one point just a few minutes ago, the absurdity of this administration's activities became viscerally apparent.

Geithner complained that, in the recent past, the private financial sector of the US economy took too many risks. Now, he alleged, it is taking too few risks, and needs to be taking more. So, he reasoned, the government was getting involved with the private sector, to encourage it to 'take more risk.'

Within the last week, the Wall Street Journal featured a headline calling attention to this administration's EPA declaring by fiat carbon-burning byproducts to be pollutants. Thus, the attendant article warned, all US business and consumers are now on notice that energy usage, costs, and the very way of American life have been thrown upwards in disarray and uncertainty.

Tim, we're all taking more risk now, everyday, thanks to the administration of which you are a part. That's why private capital remains on the sidelines.

Thanks to the EPA's unilateral declaration that our mainstay energy sources and processes are now probably going to be either declared illegal or incredibly expensive, nobody wants to take risks on the future value of assets.

Like FDR, Wonderboy has now given private capital a reason to flee markets. His administration is scaring the hell out of the American voting public. Nobody has any confidence that rules for investing, spending or just living are going to be consistent and reliable for the next four years.

Really, this is just too absurd. One Secretary implores the private sector to take risks, while another one declares life, lived as we now know it, to have suddenly become at risk on its own.

Tim Geithner Goes Slumming for Softball Questions

You have to laugh.

In order to avoid any chance at all of real questions from an informed interviewer, Treasury Secretary and administration Tax Cheat Tim Geithner appeared two nights ago on whose program?

Why, public television's good ole boy and affable dunce, Charlie Rose.

That's right. Geithner skipped any cable channel with an informed, veteran business or financial reporter who might have grilled him on issues such as:

-Tim, how can you lambaste the Bush administration's effort at rescuing the nation's banking system, when you were a key player in that rescue?

-Tim, why have you dithered since being sworn in, as you had nearly three months to prepare to tackle the various issues in your department? It seems you and the rest of your administration was great at 'transitioning,' but remain unable to govern, now that there is a new President?

-Tim, why don't you just work with Sheila Bair to close commercial banks that are insolvent, once all assets are appropriately market to economic value, such as Citigroup, which obviously would be bankrupt, had the federal government not injected so much of its current common equity?

-Do you think you'll be able to fully staff your department before your boss is running for renomination of his party for President?

No chance of questions like that from Charlie Rose. I'd be surprised if Rose knows what the Treasury Secretary does. The few moments of Rose's programs which I have seen usually show him agog with wonder and admiration for his guest. He asks questions in a tone of ignorance and appreciation that his guest will even speak with him.

Boy, Geithner couldn't have slummed much lower, could he?

Rumor has it his boss is going to appear on The View in lieu of his next press conference.

Tim Geithner's Many Hats

We all have read how thinly-staffed tax cheat Tim Geithner's Treasury Department remains.

Between the administration's belated attention to not hiring tax scofflaws, and experienced candidates' wariness of rules governing their subsequent employment, Geithner is evidently having trouble recruiting any competent talent to help him with Wonderboy's growing list of 'banks,' bailouts and other dodgy financial schemes.

A Washington-based friend told me that, as a result, Geithner has been forced to wear many hats.

Allegedly, one day earlier this week, as my friend paid a visit to the Treasury building, Geithner was at the reception desk, printing his visitor's pass. Later, when the friend and his colleague headed to the Treasury commissary, Geithner was manning one of the cash registers.

Word has it that, during their union-mandated coffee breaks, the mint's printers are spelled by the Treasury Secretary himself. He's been reported to have complained, under his breath,

'When I took this job, I was told it would eventually lead to me 'almost printing money.' I didn't realize he meant it literally, and this soon.'

Without a complete staff to assist him, Geithner puts in long hours in the Treasury building. Thus, it's also been rumored that he's been seen signing visitors and employees out late at night, while manually signing large sheets of dollar bills.

Of course, the good news is, with Tim busy doing so many valuable jobs at Treasury, he'll have less time to meddle in truly value-destroying work like providing details for more intrusion into the commercial bank sector, paying off delinquent mortgages with taxpayer money, or 'stress testing' the nation's banks.

Geithner's Disappointing Plan & Testimony

Watching Tax Cheat Tim Geithner testify before Congress yesterday was a supreme disappointment.

Can this guy be the same one as the one about whom I wrote in this post? The one Paul Volcker swore is the only guy in the country who can function as Treasury Secretary?

Larry Kudlow was right. Geithner took months to come up with....what? A modified version of Bill Seidman's 'bad bank' RTC of twenty years ago?

Surely, for all the fuss made over Geithner's brilliance, we are right to have expected much, much more from him.

As I have felt all along, Geithner seems to be just an operator, rather than a Treasury Secretary with foresight and vision. Not that Hank Paulson was so much better during the crisis of last year. But he did at least articulate a revamping of financial regulatory authorities that made some sense.

In a measure of how disappointed investors were in Geithner's so-called "plan," the S&P500 plunged nearly 43 points, or almost 5%.

Nice job, Tim.

Of course, the $64,000 question- or, in the age of Wonderboy, is that now the $64B question- is how and at what price impaired assets will be sold into the public-private trust? Geithner hasn't answered that.

Neither did he provide any estimate of the total cost of his new plan, when asked by a GOP Senator. He sort of punted, admitting it was important to know the total cost to taxpayers, but also admitting he had no idea.

This is change we want, eh?

I don't think so. I think we're in serious trouble, getting deeper as Wonderboy's Tax Cheat continues to be overwhelmed by his job at Treasury.

So This, Too, Is Change?

Larry Kudlow had a priceless response to Tim Geithner's hearings for appointment as incoming Treasury Secretary.

After pointing out the lack of credibility Geithner will always have for being a tax cheat and scofflaw, even to the point of fencing with and dancing around a direct answer to a US Senator, John Kyle (R-AZ), Kudlow bore in on a more glaring weakness.

Time and again, when quizzed on what he will actually do differently, i.e., what 'change' he will bring, to addressing problems in the financial services sector, Geithner basically said, 'we're working on it.'

Kudlow blew up and observed, to paraphrase him,

'Working on it? C'mon, Geithner's had months to figure this out and come up with a detailed plan. What's he been doing all this time, playing dress up in front of a mirror for the inaugural ball?'

Larry makes an excellent point. Wonderboy's team of new 'change' mavens was supposed to be ready to fix all American problems on day one. So what's Geithner's excuse?

Maybe he was, ah, writing checks for back taxes to the IRS, and didn't have time to come up with a plan to fix the financial sector?

Honestly, one can go further in criticizing Geithner. He was part of the current 'solution,' hip deep in the decisions regarding Bear Stearns, Lehman, AIG, et. al. And, really, beyond that, Geithner has never been accused of being a 'big idea' man.

Rather, he is sort of an operations guy. He's head of the NY Fed, but doesn't command the sort of awe that his predecessors, Corcoran and Volcker did.

Finally, I listened to part of Volcker's opening remarks on Geithner's nomination. I confess to having trouble believing, in a nation of over 300 million people, that only Tim Geithner can be Treasury Secretary. There's nobody else with sufficient experience, judgment and without Geithner's tax problems?

This is just hard to swallow. Even from Tall Paul.

As I noted in this post, I'm leery of men on horseback, and Geithner seems to become more like one with each passing day.

He'd damn well better be worth it.

More Cabinet Embarrassment for The New Messiah: Tim Geithner's Tax Problems

More embarrassment and vetting failures for the New Messiah's team. It seems Treasury nominee Tim Geithner, besides having blood on his hands for his role in the failed Treasury actions of the past year, now has a more personal issue- nonpayment of taxes and failure to properly handle tax matters relating to household help.

Oh my!

Of course, Democratic Senators one and all claim it's irrelevant because:

1. The tax code is so darn complex (gee, I wonder why?) that Geithner can be forgiven for his 'mistake.'

2. Geithner didn't try to cheat, he just made a mistake. Honest!

3. The economy is so bad that we MUST overlook Geithner's personal judgment lapses and confirm him anyway.

Wow. Doesn't this sound like how dictatorships begin? Rules and other conventions are set aside in light of the 'emergency.' A man on horseback is required. No one else will do. We must simply suspend normal conventions and judgments.

But, there are two big problems with this attitude.

First, Geithner received special treatment already. How many of us believe that, were we found guilty of Geithner's sins, but not in line to become a cabinet member, we'd be afforded such amnesty?

Second, it will permanently damage Geithner's credibility in his prospective new job. How can we trust the judgment of a man who either was not sufficiently intelligent to correctly interpret tax laws in his personal situation, or decided against, though being paid well, hiring a competent accountant to advise him on said matters?

If the argument is that he isn't that intelligent, then he shouldn't have the Treasury job.

If the first objection is simply ignored, then we have to consider his intent. That is, maybe it was deliberate. Or deliberate dismissal of his needing to observe rules and laws applying to everyone else.

You know. Those little people. The people who aren't Tim Geithner, important financial sector hotshot.

From such small beginnings do large problems grow.

Isn't it rich that, while publicly displaying a desire and attempt to become President before being sworn in, in a manner never before seen, the New Messiah is concomitantly stumbling badly on cabinet choices?