Former FDIC chairman Sheila Bair favors breaking up the big banks. She also discusses her differences with Tim Geithner during the GFC and how the Treasury Secretary skewed the banking bailout to favor Citigroup.
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Hat tip to Barry Ritholz.
By Peter Hartcher
In a speech to a closed gathering at the Lowy Institute in Sydney on Thursday, Paul Keating gave a starkly different account of Geithner’s record in handling the Asian crisis: “Tim Geithner was the Treasury line officer who wrote the IMF [International Monetary Fund] program for Indonesia in 1997-98, which was to apply current account solutions to a capital account crisis.” In other words, Geithner fundamentally misdiagnosed the problem. And his misdiagnosis led to a dreadfully wrong prescription.
For the record, Indonesia’s GNP fell 83% by July 1998.
