Market Sees Rising Chance That Geithner Will Be Out At Treasury, Taking AIG Blame Won't Help
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The calls for the head of U.S. Treasury Secretary Tim Geithner are growing daily and with news breaking late tonight that Geithner is taking the blame for the AIG (NYSE: AIG) bonuses, this trend will likely continue.
inTrade, the prediction market which lets folks trade on political futures, is seeing an increasing chance that Geithner will depart.
The inTrade contract predicting if Geithner will depart before midnight on 30 Jun 2009 has doubled from 10 to 20 since the beginning of March. A 20 means the market predicts there is a 20% chance that this event happens. The Dec 2009 contract is up 10 points to 36.
Tonight, Geithner told CNN that his department asked Sen. Christopher Dodd to include a loophole in the stimulus bill that allowed AIG to keep its bonuses. Geithner said the Treasury Department was concerned the government would face lawsuits if contracts were breached for the bonuses.
In addition to the AIG bonus situation, the details of the delayed-yet-all-important Public-Private Investment Fund have yet to be announced. Geithner's original announcement was already a big flop.
It would be a massive blow to the Obama administration if Geithner has to be fired, but leaving him in could be even worse.
You can view the inTrade Geithner contracts here.
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Comments
If Geithner goes so should Obama
When is Obama going to start showing some leadership? How many disasters does it take for people to start understanding that everything that is being implemented right now to solve this economic mess, is coming from the White House, specifically Obama, and it is not working? Obama has no experience absolutely none. He never managed people, he never managed a business, he never managed anything even as small as a lemonade stand. The man doesn't know anything about economics, he has never served for his country, how can you expect him to pick good people when he has never been in position to do that before in his entire life! Obama only knows how to spend other people's money. He spends more time showing off his pearly white teeth than anything else. The man is so incompetent and unable that he needs reading tools (teleprompters) with him all the time. In 2 months Obama has equaled the financial recklessness of the previous administration's last 4 years! Can Obama do math? Is he so stupid that he can't even do simple addition, or are the number of zeros here to much for his poor infatuated head? This is no longer just a fiasco, this is fast becoming an Obama economic annihilation. What Obama thinks he sees as the Promised Land, is really the precipice of a cliff. God help us all from Obama, bring back GWB, at least he knew how to read without training wheels.
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Obama
Jim Morris on Mar 22, 2009 05:30 PMSame as above. Is there anything in the constitution that allows for removal due to incomptence. Obama probably should be thankful that Daschel & Richardson didn't make the trip to Washington or things could be far worse. New subject - the individual that caused our's and the worlds financial meltdown, Barney Frank, has never been held accountable for spawning the subprime mortgage market mess. He pressured lenders to make loans to low income familys and individuals with subprime loans the vehicle of choice. He directed Fannie and Freddy to make subprime loans and also directed them to purchase subprime mortgages with the cash sent back to lenders who made more subprime loans. President Bush on several occassions tried to get Barney to rein in the twins but Barney refused. Wall street bought the gluttonous subprime mortgage output, securitized and sold them until individuals and institutions quit buying. The unsold surplus now resides on the balance sheets of Wall Street banks in the form of Toxic Assets. Foreign governments and institutions now hold us responsible for their purchases of these mostly worthless (who knows) securities and want to create some kind of world watch dog primarily to regulate us. So, no Barney few subprime mortgages - Fewer securitized subprime mortgages - no financial catastrophe - no catastrophe no out of control Obama flailing about digging us ever deeper in the bogs of debt - finally, no foreign goverments mad at us and threating to not purchase our debt. All of this because of Barney the Puff Fish.