According to this review Mr. Geithner thinks quite a lot of himself. He takes credit (credit?) for the lion’s share of the TARP bailout, which he sees as a success and not as many have come to see in the years since, an overreaction to a meltdown brought on by easy money which fundamentally undermined our economy.
Life would have gone on even if AIG had imploded. It was not the end of the world. There would have been even more carnage to be sure, but the dead wood of much of the economy would have been burned off in the heat of the recessionary wildfire. We’d be left with a much healthier economic “forest” in the wake of the fire.
But Geithner and and Bernanke stepped in and didn’t let the dead wood burn off as it should have. Geithner’s buddies at Goldman Sachs and JP Morgan were highly leveraged and would have been utterly disgraced. They would never have been able to show their faces in the Hamptons again. This couldn’t happen, so the taxpayers were put on the hook and Armageddon was sold.
Sounds like Geithner’s book is another one to pick up in the bargain bin in a couple months along with Thomas Piketty’s.
(From The Wall Street Journal)
Regardless of the story Mr. Geithner is telling now, there remains the question of why exactly America couldn’t survive without a firm like Bear Stearns, which held no taxpayer-insured deposits. Mr. Geithner tells the story of Warren Buffett approaching him at a conference shortly after the rescue to offer congratulations. “I was sort of hoping you wouldn’t do it, because then everything would have crashed and I would have been first in line to buy,” said Mr. Buffett, according to the book. “It would have been terrible for the country, but I would’ve made a lot more money.” A scenario in which Mr. Buffett is snapping up bargains doesn’t sound like Armageddon.
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