It is bizarre that the Times should have to run a cover story today saying that there's a crisis of confidence around Geithner because of the AIG bonuses, like he should have seen it. First off, Obama should never have jumped in on that subject, he's debasing the office of the Presidency a little bit. Secondly, it's not the job of the Secretary of the Treasury to micromanage agreements entered into before he took the job.
Not that I have anything against lynching AIG Financial Products. I just think the task should be delegated appropriately.
Thursday, March 19, 2009
Lay off Geithner
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3 comments:
You're right, it's silly to be concerned about his oversight, he's just responsible for billions of dollars of our tax money. Although oversight of tax money may not have been his forte anyway, given his failure to pay taxes.
Geithner will rise up, swollen with anger, and smite his foes with his enhanced weapon.
I agree with your take on this. The AIG bonus issue is hugely overblown. I'm assuming these were contractual obligations. A lot of the Wall St firm gave bonuses to the employees with guaranteed contractual bonuses and very little bonus (or none at all) to everyone else. That's what this sounds like to me. It's easier to pay people what you owe them than claim you can't because the people who just lent you $80 billion would be disgusted. The appropriate response is to make CDS agreeements much more expensive to write. Require huge capital set-asides and have the whole book of business examined by a risk auditor every quarter.
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