The WSJ is reporting that Treasury is thinking about converting the preferred shares in Citi that cost it $45 billion (and that’s not counting government guarantees of a $301 billion Citi loan pool) into a 25% to 40% share of the company’s common stock. This even though all the common shares of Citi could (in theory, at least) have been …
Wall Street & Markets
The financial crisis becomes a TV show
On Tuesday night, your local PBS station will be airing (probably around 9) a FRONTLINE documentary called Inside the Meltdown that is by all appearances the most in-depth attempt so far to explain our little crisis on video. From the preview clips available for viewing on the site (I’d embed one but WordPress has chosen to make that …
Is it really already time to declare the Obama presidency a failure?
Paul Krugman, glomming on to the Failed Presidency of Barack Obama meme originated earlier this week by the FT’s Martin Wolf, writes in his column today:
So far the Obama administration’s response to the economic crisis is all too reminiscent of Japan in the 1990s: a fiscal expansion large enough to avert the worst, but not enough to
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Blaming People for the Financial Crisis for Fun and Profit
Barbara and I both participated, not entirely unwillingly, in TIME’s group effort to pick 25 People to Blame for the Financial Crisis. It was initially conceived as a Web project (at first we were going to try for a list of 75, but that just seemed way too tiring, both for us and for readers), and while it has ended up in the magazine as …
Suze Orman and the glories of dollar-cost averaging
Felix Salmon has a long and rousing defense of Suze Orman against an attack piece by documentary filmmaker James Scurlock:
There are millions of Americans out there who fail to pay their credit card in full each month despite the fact that they have money in the bank to do so. There are tens of millions who have stock-market investments
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Geithner: Not more bank lending, but more bank lending “than would have been possible without government support”
In his big speech Tuesday, and while answering questions from members of the Senate Banking Committee afterwards, Treasury Secretary Tim Geithner used extreme care when he talked about goosing the amount of lending done by banks. Here’s the phrasing from his speech, which he repeated almost verbatim later in the day:
The capital will
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Reviewing Tim Geithner’s big day
I’ve got a piece up on TIME.com about our new Treasury Secretary’s first real day in the spotlight (I give him better marks than the stock market did). Meanwhile, Stephen Gandel discusses the actual plan. And Adam Smith has an entertaining article about British bankers saying they’re sorry again and again and again. Enjoy!
Ray Dalio on the “D-process” we find ourselves in
Barron’s has a long and sobering interview with Ray Dalio, chief investment officer of the big hedge fund firm Bridgewater Associates (which actually made its investors money last year). He believes that comparing our current economic predicament to the recessions of the post-World War II era fails to take into account the deleveraging …
Geithner goes for a laundry list, not a dramatic gesture
Treasury Secretary Tim Geithner has just finished his first big speech. The contents had already been so widely reported that there weren’t any big surprises. The main message that Geithner seemed to be trying to get across was that, while he had no big plan to solve the financial crisis in one fell swoop, he intended to proceed with …
Shall we call the new bank bailout the FSP, the FiSt Plan, or something else?
It looks like the Treasury Department will simply be calling its new-look bank bailout the Financial Stability Plan, which doesn’t form a fun acronym at all. That’s probably the reason Tim Geithner picked it, of course. But it shouldn’t stop us. For one thing, if you take the first two letters of the first two words (and why on earth …
Let’s have a rename-the-TARP contest!
You’ve surely already heard the news that Treasury Secretary Tim Geithner is going to announce a new and, one hopes, improved bank bailout plan Tuesday. There will probably be lots of stuff in it about a “bad bank,” toxic-asset purchases, cash injections, new FDIC powers and the like. But here’s the really important part (
New column: New world order
I’ve got a new column online and in the issue of TIME with Walter Isaacson’s How to Save Your Newspaper (which I hope to tear into here later) on the cover. It begins:
In recent weeks, the world has been politely standing by and watching how things play out with the fiscal stimulus and latest bank-bailout plans in Washington. Yes,
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