When you are a hammer, every problem looks like a nail.

[burythehatchet]

I think we are on the wrong path regarding our financial system recovery. And while Obama obviously thinks he is doing the right thing, by appointing Geithner and retaining Bernanke he hired hammers to thread a needle.

These men are hammers. They represent a specific force in the economic system. They are able to help in certain aspects of the recovery, but their skill set is not the one that is required at the moment. The problem is not one of financial recovery, the problem is that a group of men were told that they could pocket hundreds of millions of dollars by running a scam. Better than that, when the scam was exposed, they could keep the money and we would pay them some more to fix the financial system.

Another image that works for me: The financial system is a race car. The captains of the financial industry are the drivers. But the race car had three flat tires and a broken axle. The race is continuing but we are asking the driver to get going.

What has to happen is there must be a criminal reckoning of what has occurred. That is the only way that some hint of trust could be regained. Simultaneously, we need to structure a worldwide financial control mechanism. People have been able to conduct currency arbitrage and get entire nations into trouble. (see Iceland). It has to be coordinated and it has be binding. A United Nations of currency management. The current regulatory frame work has to be doubled and it has to be enforced.

And most of all, we have to completely get rid of the notion that bankers and financiers deserve to earn the kind of money that we have seen collect for their services. (This on is personal because my brother is one of them).

[Captain Hilts]

1. I don't think he has a choice on Bernanke. It's complicated enough I'll defer to the Prez right now

but I wonder about oversight of the money. THAT's my concern. The idea that we give them money and then we have no ability to know how they're exactly using it is NOT good.

[notesdev]

2. It's not that complicated

The market is in the tank because nobody trusts it, nobody trusts it because nobody tells the truth, nobody tells the truth because they get away with it.

[KharmaTrain]

3. So What's Your Alternative?

Do you allow the banking and financial system to implode completely? Root out everyone who ever worked for a corrupt bank or investment house? Do you disqualify anyone who had any relationship with this system over the past 5 years? 10 years? And then what?

I'm not happy with the half-assed games Geitner appears to be playing, but right now this is uncharted waters. He was handed a system in total collapse...a deck of cards that still hasn't fully collapsed. He wasn't responsible and trying to get a handle on this mess is beyond almost anyone's comprehension.

While I'd like to see a Bob Reich or Paul Krugman calling shots here, even they admit this situation is extremely fluid and gutting the system entirely will hurt everyone in this country...even those without money in banks or markets. The game here is to find a floor...stop the bleeding...end the defaults and bankrutcies and get credit moving again. It's after you fix this massive hemoraging that you have the luxuary to see whose responsible.

IMHO, the days of the high flying CEOs and execs will end not at the hands of the government, but by the shareholders. These are the people taking the biggest hits for the losses (many haven't seen dividends for months) and stand to take the biggest losses. They're going to have a say in this matter before its over...as will many attorneys and prosecutors who are just starting to unravel the massive corruption that's occured.

Time will be the avenger here, but right now, options are limited. If there is some silver bullet or fix, please share it.

Cheers...

[Captain Hilts]

4. Yes. We can't let the system collapse. Shareholders have got to get angry and act on that anger.nt

[KharmaTrain]

5. The Government Will Soon Be The Shareholder...

Are you prepared for a total collapse? Honestly? Have food grown or stocked away? Enough gold or other barterable commodity to use if money becomes completely worthless? We're close to seeing this happen and the worst pain is yet to come no matter what "stimulus" is pumped in...this snowball is too far down the hill. Do you let that snowball crash into the town or at least get people out of the way?

Ultimately many of these banks will have to be nationalized...bad debt stipped away and the solvent parts sold off and a new system established. But we're not there yet...and the question is what type of landing...hard or soft.

Again...what the alternative? Do you let everyone's savings vanish just to punish the rich? Let companies choke on the lack of credit to keep operating and put millions more out of work? Let every failing loan default and push thousands or millions into the streets? Again...I'm all eyes...