Wednesday, January 14, 2009

Geithner cheats the tax collector?

For $17,000 and $23,000 and his nanny didn't pay some taxes?

How about his complicity in causing shareholders to be wiped out in Lehman?

Geithner only recognized the problem at Lehman the night before it imploded. His suggestion then, was to have 30 banks put up $35 billion for $85 billion of Lehman's assets in a fund called the "bad company" so somebody else could buy the "good company." Yes, the good company, that bought the bad company's assets! How about his advisors that were pouring over Lehman's books in April? Didn't they see anything amiss? Didn't they take a lead from any of the vocal shortsellers who already did?

In his testimony before the Senate about Bear Sterns, Geithner said "we only lend to sound institutions." Does that mean Lehman then, was sound? How about in June, when he was speaking before the San Fransico Fed and he said, "A classic problem in financial crises is to distinguish between problems of illiquidity and insolvency." Since the Fed was lending to Lehman, and since the Fed lends only to solvent institutions, didn't that mean then that Lehman was just having a liquidity crisis? Isn't that why these alphabet soup lending programs were set up? But it was never about liquidity. It was always about solvency! And Lehman was insolvent!

And if "no one" recognizes the difference between illiquidity and insolvency what does this make Geithner? No wonder no one uses logic!

Tipped in Washington as the next US Treasury Secretary in the event of a win by Barack Obama, he has been shown at his best in a crisis in recent months. He has spent the past year getting his head round credit derivatives, with fortuitous timing.

The rest of the story is at the link below. Maybe his tax problem with the IMF will allow someone to take a closer look at him.

And more on Timmy here.

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