Six Months In

The Congressional Oversight Panel issued another report on the TARP. Again, it does not enthusiastically back Geithner etal. The report questions the validity of the Treasury's view of the economy; they feel it's too rosy. Further, the report goes on, “All successful efforts to address bank crises have involved the combination of moving aside failed management and getting control of the process of valuing bank balance sheets.” Which is not what Geithner is doing; he's letting the banks run the show. The fact that we're funding the operation seesm to mean little to him.

Some more excerpts :

• “Allowing institutions to fail in a structured manner supervised by appropriate regulators offers a clearer exit strategy than allowing those institutions to drift into government control piecemeal.”

• The report also said that past successful financial rescues were accompanied by governments’ “willingness to hold management accountable by replacing -- and, in cases of criminal conduct, prosecuting -- failed managers.”