An ABC ‘This Week’ Transcript: Timothy Geithner

Posted by Kendall Harmon

Now, Goldman Sachs, for example. Their chief financial officer said he had no material economic exposure to AIG. So why weren't they forced to take a discount?

GEITHNER: George, we came into this crisis as a country without the tools necessary to contain the damage of a financial crisis like this. In a case of a large, complex institution like AIG, the government has no ability, had no meaningful ability to come in early to help contain the fire, contain the damage, prevent the spread of that fire. Restructure the firm, change contracts where necessary, and helped make sure that the financial system gets through this...

STEPHANOPOULOS: But it would have been the right thing to do, right?

GEITHNER: If we had the legal authority, that's what we would have done. But without that legal authority, we had no good choices. We were caught between these terrible choices of letting Lehman fail -- and you saw the catastrophic damage that caused to the financial system -- or coming in and putting huge amounts of taxpayer dollars at risk, like we did at AIG, to keep the thing going, unwind it slowly at less damage to the ultimate economy and taxpayer.

Read it carefully and read it all.

Filed under: * Economics, PoliticsEconomyThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--The U.S. GovernmentTreasury Secretary Timothy Geithner

3 Comments
Posted March 29, 2009 at 2:00 pm [Printer Friendly] [Print w/ comments]



1. Jeffersonian wrote:

Geithner is a fascist.  And I use that word advisedly.

March 29, 9:02 pm | [comment link]
2. Dave B wrote:

What part of people being secure in private property don’t these folks understand?  If AIG fails it fails.  The government can’t secure investment against risk.  Social Security is a good example of government management.  Instead of investing during good times the excess is spent on Government waste.  When the resources spent on waste are needed we have a crises that requires renagotiating the contract and great cost to the tax payer!  Let businesses fail.  Some need to fail!

March 30, 7:10 am | [comment link]
3. Sick & Tired of Nuance wrote:

“...the government has no ability, had no meaningful ability to come in early to help contain the fire, contain the damage, prevent the spread of that fire. Restructure the firm, change contracts where necessary…”

Gee, I thought that was what bankruptcy was for!  This guy has ZERO credibility.  Oh yeah…he can’t even figure out his own taxes!

March 30, 7:56 am | [comment link]
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