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February 10th, 2009
11:59 PM ET

Geithner's plan falls flat

Colin Barr
Senior Writer, CNNMoney

Treasury Secretary Tim Geithner failed Tuesday to persuade Wall Street that he will succeed where his predecessor Henry Paulson failed.

Geithner outlined the administration's plan to restart frozen credit markets and bolster the health of troubled banks. He said the economy will recover from its swoon only with the help of healthy financial institutions.

But observers said the Obama administration's plan is neither well-funded enough to recapitalize troubled banks, nor detailed enough to assure investors that the government can solve the toxic asset problem plaguing banks.

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Filed under: Economy • Finance • President Barack Obama
soundoff (20 Responses)
  1. Michael "C" Lorton, Virginia

    A toxic economy--cause by toxic financial institutions--and most of all toxic greed---and our government stood by and watched it all materialized--now the government is going to be the Savior with their stimulus plan--right-–and I'm going to regrow hair on my bald head-–

    February 11, 2009 at 10:42 am |
  2. Wanda

    Where is the provision for E-Verify or stringent accountability for the American citizen worker when the Stimulus Package creates all the construction infrastructure jobs? How will you keep greedy contractors from hiring illegal alien immigrants and not Americans when they get their hands on these billions of dollars??

    Without protection for American workers, get ready for an invasion of illegal alien immigrants. They are salivating at the thought of coming to get these jobs. America is going to be invaded and Americans will watch Illegal alien immigrants work while they are unemployed. Get ready for chaos.

    February 11, 2009 at 4:02 am |
  3. Lino Sanft

    Nobody gets it! Geitner is holding out on TARP-2 in order to put pressure on Congress to pass the Stimulus Package. Why should Wall Street get their money before Main Street. If Wall Street gets their money first then they would have a distinct advantage during the event of an economic recovery not to mention the outrage of the Public. Furthermore, if everybody gets their "hand out" at the same time then everybody should starting on equal footing. It is painfully obvious to me.

    February 11, 2009 at 2:08 am |
  4. Chia-Wen Chang

    The Wall Street voted on the plan of Secretary Geithner by dropping 400 point. Are they saying that the plan of rescuing the banks would not work since the previous cash infusion to the banks did not free up the credit? The US government should take the rest of the tarp money and loan it directly to the consumers through IRS instead of giving it to the banks to be given out as executive bonus and miss the real goal. This will bolster the real estate prices and give the leveraged securities a well defined value. The banks will benefit from this and car industries will benefit from being able to sell cars.

    February 11, 2009 at 1:39 am |
  5. Anthony, Austin TX

    Today Obama announces his bank rescue plan and the market sells off almost 5%. Clearly the markets are disappointed of the news, yet the main stream media says the market is disappointed at Tim Geithner's announcement. Tim Geithner is Obama'a Secretary of Treasury. Yet the press never mentions it is really Obama's plan. The spin and blame is on Geithner.

    Now why didn't the press ever say anything after the market dropped when Obama was inaugurated or when he was elected (after his election the Dow dropped over 2000pts). Both times the market fell even more points.. Another clear example of the liberal media bias...

    February 10, 2009 at 11:55 pm |
  6. Fred Marcus

    Secretary Geithner has said he will try to get private investors to help buy up bad bank loans and will offer incentives in the form of a safety net.
    This appears to let people with significant assets increase their wealth at the potential cost to the average taxpayer if the investments go sour. I think we tax payers have enough of bearing the brunt of the economic downturn.

    February 10, 2009 at 11:29 pm |
  7. Lisa in Alabama

    My question is regarding the specific of the 2nd Tarp, and how would if affect those of us that have already lost our homes and who have the foreclosure already on the credit report. Would it help us, once we've regained full time employment?

    February 10, 2009 at 11:25 pm |
  8. tundey Tunnerro

    How long can we wait to solve all this financial problems? After all New York Cops will not stop giving Tickets; Where are the people gonna get the money when Executives are embezzling the peoples money. lets get a break!

    February 10, 2009 at 11:23 pm |
  9. Jim,California

    I've allready solved my financial crisis, its called take my money out of the Banks & don't do bussiness with them, I want or need something it is COLD HARD CASH or nothing.

    February 10, 2009 at 11:22 pm |
  10. jim Fallbrook CA

    Timothy Geithner is a tax cheat as Treasury Secretary in charge of the IRS. He won't help anybody but his corrupt friends and himself. I guess this is what Obama meant as change. Putting corrupt thugs in charge.

    February 10, 2009 at 10:50 pm |
  11. April Allen

    I'm a homeowner currently behind on my mortgage due to loss of job/income. I have been in contact with my mortgage holder multiple times but they refuse to offer any alternative options to my current mortgage. I am beginning to believe there is no bailout for the American people. The banks apparently don't need to help us since their losses are being covered by the federal government!

    February 10, 2009 at 9:57 pm |
  12. Andy in Oh.

    As long as the abusers of the finacial system are not legally punished there will be no trust in investing our markets. So no one will prosper.Geithner allready stated that there is soild banks out there.So allowing decepters of the system to contiune will never let people feel safe about thier finances.Do you want to put your money on a widow ledge and hope the wind does'nt blow it away?

    February 10, 2009 at 8:49 pm |
  13. Lewis Bailey

    I just listen to the comments that Cambell Brown's show of some guy saying that the plan should be perfect. That's nice!
    while people like the lady living in her car. Try to survive another day. Sure you have time. You have a computer, and a camera attached to it, electricity, a home, you were dressed nice, house looks good. Sure you have time.

    February 10, 2009 at 8:24 pm |
  14. ann douthitt

    If american jobs are one of the main concerns in the stimulas package, please tell me why one of the top banks, JP Morgan Chase, is receiving yet more money when their work is being and has been for many years out sourced to Mambai, Manila and Bangalor. The sights that are in the US are being dwindled down every month, soon to close some completely. There goes are american jobs overseeas and the President wants to give them more money. JP morgan Chase takes care of mortgage payments such as Gmac Mortgage, energy companies, waste services, telephone and automobile payments. Also these companies are using JP Morgan Chase service which is being out sourced. So why give the automobile and mortgage companies any money? How many more jobs need to be lost to India and elsewhere before something is down about this. My job will soon end while the rest of the world is taking over.

    February 10, 2009 at 7:40 pm |
  15. Lisa in CA

    Ummm, where is the additional $150b coming from? If I understood correctly, the original TARP was $750b, of which $350b has already been spent, leaving $400b. That's $1b shy of they proposed private-public sector funding.

    Oh, BTW, I'm a "doer" – give me the money and watch me put it back into the economy. I can afford to buy a new car (or 2), a house, take a vacation, buy toys - i.e., put people back to work. With enough funding I may even do what Richard Branson (he of Virgin fame) did and supply seed money to whomever comes up with the best new idea for going green or some other new technology.

    We workers down here (also known as the Middle Class) are "doers" – we build, innovate, market, buy ... we are the ones who keep the economy functioning at all levels. We are the ones who make the rich rich and/or allow them to keep their lifestyles. It's too bad they haven't quite realized that yet.

    February 10, 2009 at 6:52 pm |
  16. Annie Kate

    I hope someone will explain all this on the show tonight. It sounds good but I haven't any idea what could be done instead or how this benefits the average citizen. I know that change takes time and that you cannot always complete your journey in 1 day or 1 week or even 1 year but what is the "hoped for" time frame on this plan?

    February 10, 2009 at 6:29 pm |
  17. earle,florida

    Your in good hands with the, "Secretary of Treasury" Mr. Timothy Geithner. He is a member (was) of the "Group of Thirty" (G30)! He has been mentored by "Lawrence Summer's,and is better known in close circles as a Protege' of past Sec. of Treasury Mr. Robert Rubin! The G30 is a comprehensive collection of the best financial minds through-out the world! These are very diversified ,and independent thinkers,with a singular goal of implimenting timely, and realistic solutions for the "World's Evolving Economies"! PS. There is supposedly a finalized ,"2008 Manuscript Report" by the G30 being released in early 2009. Thanks

    February 10, 2009 at 6:27 pm |
  18. JC- Los Angeles

    It's now clear that Timothy Geithner, of tax evasion fame, sailed throught he nomination process because he's Wall Street's inside guy in the new Obama administration.

    Not only did Geithner and his good old boys on Wall Street make a killing off of mortgage fraud and toxic mortgage backed securities, now they are planning on rebuilding Wall Street and getting paid again off the same fraudulent loans.

    It's as if these connected hacks, right in front of the American people, have created a way to make even more money off taxpayers, mortgage fraud and the government.

    Pathetic.

    February 10, 2009 at 6:09 pm |
  19. Katy

    Geithner is the wrong choice for this kind of job. He will protect his old boy network like Paulson.

    Very soon this country will be like 3rd country with rich gets richer, wealth gets wealtier and most of us become their housekeepers, nanny, drivers, cooks, maids, gardners, etc.

    Republicants put us into this situation with help from Democrats.

    No hope, no change .. where is the slogan of Obama's camgpain? It drowed down the Potomac river.

    February 10, 2009 at 5:23 pm |
  20. Donna Richardson

    "We are exploring a range of different structures for this program," Geithner said of a plan to create a public-private investment fund that will start at $500 billion, and then expanded "based on what works."

    Aren't we just helping the rich get richer? I am sure the Wall Street Executives will be able to take advantage of this with the bonuses they received. Tell me how the will help the average person?

    February 10, 2009 at 5:07 pm |