Treasury Secretary Timothy Geithner said the U.S.’s $700 billion financial rescue package can’t be used to aid
Lehman Brotherscities and states facing budget crises.
The law “does not appear to us to provide a viable way of responding to
the issues that Lehman Brothers facesthat challenge,” Geithner told a House Appropriations subcommittee in Washington today. Among the hurdles: Money from the Troubled Asset Relief Program is reserved for financial companies, he said.
The Treasury chief said he will work with Congress to help
investment banksstates such as California that have been battered by the credit crunch and are struggling to arrange backing for municipal bonds and short-term debt.
Obama’s Economic Superfriends
Nothing is fucked people. Nothing. Nothing at all. Green shoots are made thick oak. Cats have filed for voluntary separations from dogs and are no longer living together. Britney will retire from creating… anything. Including children. The Flu is cured. So is cancer. Just relax, will you?
Lawmakers in Washington are increasingly optimistic that the prospect of economic Armageddon is behind them.
Despite rising unemployment and continued dismal news in the housing market, which instigated the financial crisis, there’s been a definite shift in the Beltway’s economic mood.
“We’re headed toward the bottom,” said Rep. Paul Hodes (D-N.H.), who expects continued uncertainty in the economy but sees a recovery on the horizon.
“It will be a very slow, gradual recovery,” he said. “But it’s like falling off a cliff. It’s the place where the cliff hits the beach, that kind of end of collapse.”
…where your battered and crushed body will be gently nestled in a bloody bed of sand, quietly caressing you before the crabs begin to pick at your lips and the seagulls your eyes. How very beautifully peacefully consoling. Hey, how about you raise my taxes now?
Lawmakers don’t expect Armageddon [The Hill]
Optimism in the face of facts seems to be the theme this week, and it’s only Monday. Don’t shed any tears. Growth is just around the corner. Right after our massive deficit becomes a bit more massive and the tens of billions of savings add up to offset hundreds of billions. What are you worried about?
The Obama administration projected that the U.S. economy will expand at a 3.5 percent annual rate by year-end, a rebound that would be almost twice as strong as private forecasters expect.
In the economic assumptions of its 2010 budget request, President Barack Obama’s economic team didn’t change its 2009 predictions for a 1.2 percent drop in gross domestic product this year, slower inflation, higher unemployment and lower market interest rates than a year ago.
Yes, they were eye-wateringly high, but you didn’t really believe the initial budget deficit estimates that came out of the White House, did you? I mean, you knew they were a crock of reptile dung when first their stench wafted by your nostrils, didn’t you? Or did you? Were you soothed by the placating and calming words that accompanied the figures? Are you as likely to be cowed by assurances that there are a few billions in savings in there somewhere that over the years will “add up?” Exactly how financially challenged do the powers that be think we are?
Wait, don’t answer that.
The White House on Monday pushed up its forecast for the U.S. budget deficit for this year by $89 billion, reflecting the recession, a raft of new unemployment claims and corporate bailouts.
A fresh estimate of the deficit showed it coming in at $1.84 trillion — representing a massive 12.9 percent of gross domestic product — in the current 2009 fiscal year that ends on September 30. A prior White House forecast released in February projected a deficit of $1.75 trillion, or 12.3 percent of GDP.
With all the talk of buying American lately, and with Obama taking the opportunity with the cameras to give Chrysler a bit of free endorsement work (Chrysler, we hope you file that on your taxes)…
So these are some of the steps that we’re taking to make it easier for Americans to buy a car. If you are considering buying a car, I hope it will be an American car. I want to remind you that if you decide to buy a Chrysler, your warrantee will be safe — because it is backed by the United States government. And to further boost demand for autos, we are working to accelerate the purchase of a federal fleet, and we’re also working with Congress on fleet modernization legislation that can provide a credit to consumers who turn in old cars and purchase cleaner, more fuel-efficient cars.
…we thought we would revisit the Administration’s driving habits.
Of course, one fact missing from our old exploration on the topic was that Obama traded in his Chrysler 300C for a Ford Escape Hybrid in 2007 after putting a mere 20,000 miles on the Chrysler. Odd, Chrysler wasn’t good enough to hang on to back then. What’s changed?
Who drives what, after the jump.
Meet the evil villains that won’t let Chrysler just escape its obligations to pay its creditors:
As of last night’s deadline, we were part of a group of approximately 20 relatively small organizations; we represent many of the country’s teachers unions, major pension and retirement plans and school endowments who have invested through us in senior secured loans to Chrysler. Combined, these loans total about $1 billion. None of us have taken a dime in TARP money.
As much as anyone, we want to see Chrysler emerge from its current situation as a viable American company, and we are committed to doing what we can to help. Indeed, we have made significant concessions toward this end — although we have been systematically precluded from engaging in direct discussions or negotiations with the government; instead, we have been forced to communicate through an obviously conflicted intermediary: a group of banks that have received billions of TARP funds.
Perhaps showing a seven season West Wing marathon wasn’t the best Oval Office training film after all?
Statement From Non-Tarp Lenders of Chrysler [The Wall Street Journal – Deal Journal]
If anyone harbored any illusions with respect to the crushing complexity involved in trying to restructure a firm before during or after bankruptcy, the last several hours should clear that question up nicely:
8:52 am EDT
9:16 am EDT
9:41 am EDT
9:54 am EDT
The time-line betrays a nearly blind, almost naive optimism on someone’s part. It is easy to feel sorry for the Administration in the way you pity the little kid who was sure she would be “A Fairy Princess” when she grew up.
Administration Official Says Chrysler to Enter Chapter 11; Obama to Speak at Noon [The Wall Street Journal]
From the “lost in the weekend noise” file:
The President has 100% confidence in
Secretary Geithner Mr. Rattner Chairman Bernanke.
Emanuel Says Obama Has ‘100% Confidence’ in Fed Chief Bernanke [Bloomberg]