Afternoon:
10°c
Watching the new US Treasury Secretary, Timothy Geithner, announce his quackish remedy for our financial ailments this week, another politician came to mind. The Bambi stare, the disembodied grin. It was Tony Blair all over again. And Wall Street hated it, sending the Dow plummeting in response to his ideas.
Two years ago, while he was running the New York Federal Reserve, Geithner told The Wall Street Journal: "Most consequential choices involve shades of gray, and some fog is often useful in getting things done." Well, he certainly has the fog now, and some consequential choices to be made.
It also seems President Obama's team may be lining him up to be shot if this latest bailout doesn't work. Several of them were reportedly pressing for heavy restrictions on financial institutions taking government money - they felt the country would demand this after all the stories about bonuses, corporate jets and John Thain's $35,000 commode at Merrill Lynch.
Geithner said no. Banks need latitude to get up off the deck, he argued. Government would never be a decent bank administrator. It should stimulate the economy and give banks incentives to lend, but should not hover in the executive suite. As he gets ready to shovel billions more down the chute, he had better be right. Because as the Obama team has made clear, if you're going to stand up for Wall Street, you're on your own.
* After the tax problems besetting Obama's Cabinet nominees, including Geithner, right-wing talk show host Sean Hannity had at least one good joke: the reason the Democrats don't worry about raising taxes is because they don't pay them.
* Sotheby's has just turned a neat trick in Manhattan's ailing commercial property market, by repurchasing its Upper East Side HQ. It sold the building in 2002 for $175 million, then leased it back. The buyer then tried to re-sell it in 2007 for $500 million. With no takers and prices heading south, Sotheby's bought it back for $370 million, only $135 million of it in cash. Such nous will be an asset during what seem set to be grim years for the auction business.
