Video: Tim Geithner's Accidental Brush With Truth...
Video - Tim Geithner before House Financial Services - Mar. 1, 2011
Watch the hands. Geithner lets down his guard at Fannie hearing, and out comes the truth on bailouts. Clip starts automatically at 3:36
- "As you know, the history of financial crises is largely a history of banks and real estate together. And the government ultimately is there. It's just behind the banks with this implicit support that they don't charge for. It still leaves the taxpayer expected...I mean, exposed to loss."
A couple of weeks ago, Treasury presented Congress with three possible options for reforming the mortgage market and for getting rid of Fannie and Freddie. Treasury's "Option 2" and "Option 3" both retain a large degree of government support for housing. Treasury's "Option 1," however, creates a mostly private mortgage market with only limited support from the FHA for low-income borrowers.
In this clip, Geithner has just been asked which of the three models he prefers for the future of Fannie and Freddie. He has already made it clear that he does not support Option 1, which would most likely have a negative effect on home prices and thus hurt bank balance sheets. That's to be expected - we know that Geithner can be counted on to support the banks at every turn.
But what he actually said was totally unexpected. Watch him as he slips and tells Congress that even without an explicit government guarantee for mortgages, the government will come in to protect the banks at taxpayer expense anyway. This is no great revelation - everyone knows that to be the case. But for months the administration's line has been that Dodd-Frank solved Too Big To Fail and that there will never again be a taxpayer bailout of the banks. Just watch, it's pretty obvious Geithner knows he made a gaffe, because he gets audibly tongue-tied and then swallows really hard mid-sentence before regaining his composure.
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Here's the full 5-minute exchange...
Further reading...
Mar 5, 2011 at 2:50 PM
Reader Comments (12)
http://www.nytimes.com/2011/03/03/world/asia/03afghan.html?_r=4&hp
http://www.humanevents.com/article.php?id=28641
[snip]
Mr. Raines immediately went to work lobbying Congress for less regulation and more "flexibility" in creating the massive dodgy-loan portfolio of under-qualified home loans to fellow minorities which would continue to grow and was encouraged by Barney Frank, another former Democrat & Harvard Law School graduate who now heads up the House Financial Services Committee -- which has key oversight over both Fannie Mae and Freddy Mac......
.......Then, in 2006, the OFHEO filed suit against Raines in order to recover the $50 million in personal payments made to Raines based on Fannie Mae's overstated earnings which were initially stated to be $9 billion but have since been reduced to under $6.3 billion.
Undeterred, Mr. Raines now works for another Harvard Law School graduate, Mr. Barack Obama's presidential election campaign -- as an advisor on mortgage and housing policy matters.
Comment: What the F@(# is it with these Harvard people. Shut the place DOWN now!
HOMEOWNER SUFFERS HORRIFIC INJUSTICE AT HANDS OF JP MORGAN CHASE.
http://stopforeclosurefraud.com/2011/03/05/homeowner-suffers-horrific-injustice-at-the-hands-of-jpmorgan-chase/?utm_source=feedburner&utm_medium=twitter&utm_campaign=Feed%3A+ForeclosureFraudByDinsfla+%28FORECLOSURE+FRAUD+%7C+by+DinSFLA%29&utm_content=Twitter
Comment: Brought to you from the guys handling the Iraq Reconstruction funds and Food for Oil Program. Crash JPM and keep an eye on where their people end up afterward like Enron!!
[snip]
from Global Trade Review, Trade & Forfaiting, and Trade Finance -- came in the form of seven "2009 Deal of the Year" awards for transactions in vital sectors ranging from energy to telecommunications in countries that include Turkey, the United States, Vietnam and Iraq. Highly complex and dependent on the teamwork of many interested parties, including the U.S. Export-Import Bank, the transactions were typically completed on tight schedules and depended for success on the expertise of J.P. Morgan's trade banking teams. The Trade Bank of Iraq/GE Energy deal recognized by all three magazines is an historic $3 billion Letter of Credit transaction that enables the purchase of power equipment to rapidly develop energy infrastructure and increase electricity production in Iraq.
Comment: http://dailybail.com/home/is-ge-the-real-reason-paulson-panicked-in-the-aftermath-of-l.html
How Harvard Deep-Sixed Its Russian Scandal
By DAVID WARSH
http://www.counterpunch.org/warsh03042011.html
[snip]
Gilman should know. He was named a senior member of the International Monetary Fund’s Russia team in 1993, just after the Clinton administration took office. He moved to Moscow in November 1996 and remained until 2002.
[snip2]
Evidence had surfaced that the team leader, Harvard professor Andrei Shleifer, his wife, his deputy and the deputy’s girlfriend, had, in the office of their Russians advisees, muscled aside legitimate firms in order to obtain for themselves the first license to distribute mutual fund shares in a vast impending privatization.
[snip3]
The case had been investigated extensively and tried in US District Court in Boston. Harvard and Shleifer’s defense had been curtly rejected by both a judge and a jury. Both were found to have committed fraud. The dismal end of “the so-called Harvard Boys,” as Gilman described them in passing in his book, was, in other words, a proven case.
[snip4]
Shleifer’s good friend and mentor, Harvard economist Lawrence Summers, who as a member of the department had been involved in assembling the team in the first place, remained at the Treasury Department, where, as deputy secretary, he oversaw the US response to the Russian crisis in 1998. In 1999 he became Treasury Secretary himself, replacing Robert Rubin. In 2000, the US government sued Harvard and the others for fraud and, after the matter was extensively litigated, recovered its fee.
Wake up people it is not about to happen it IS happening.
http://stopforeclosurefraud.com/2011/03/05/homeowner-suffers-horrific-injustice-at-the-hands-of-jpmorgan-chase/
For the bailout movie project I've been working on, we recently ran some ads in various cities soliciting personal experiences with banks and foreclosure. What we've heard so far is remarkably similar to the linked stor:. banks tease distressed homeowners with low-payment options for a few months, give conflicting information and otherwise give HO's the runaround, and then ultimately foreclose. Disgusting.
http://abclocal.go.com/kgo/video?id=7995982
Can't wait to see the finished product!