Obama Explaining Geithner Plan to Save Banks Will Pay Off in Consumer Confidence
By Mary Kate Cary, Thomas Jefferson Street blog
Today's a big day at the Treasury Department, where Secretary Geithner will be unveiling the new Financial Stabilization Plan (or TARP Two, as it's also known). Last night the president held his first prime-time press conference from the East Room of the White House, and took his case for the administration's stimulus plan to the American people. When it came time to answer a reporter's query about the Financial Stabilization Plan, however, the president ducked the question and said he didn't want to steal the spotlight from the Secretary's announcement today.
It's too bad he didn't answer the question, because it was a great opportunity to explain to viewers the fundamentals of what happened in the banking industry and why this plan is better than TARP One. He gave long and detailed—and understandable—explanations on other issues. Why not this one? One thing about President Obama: he speaks with clarity, and people love it.
I'm no financial wizard, and I don't think I'm the only one who thinks the financial coverage of this crisis has been confusing, contradictory, breathless and even scary. Isn't that the problem—that someone needs to explain to the American people why this bank bailout will work without using economic jargon that only hedge fund managers understand?
It seems to me that there are two keys to ending this crisis: stabilizing the banks in order to get credit flowing again, and rebuilding consumer confidence. Explaining the plan to stabilize the banks and getting people behind it will pay off in consumer confidence.
On a lighter note, and as a public service to similarly challenged readers, I pass this along: Amid the mountain of economic commentary this morning, here is the Daily Beast's new Valentine's Day poll showing that the financial crisis is having a terrible effect on Americans love lives. Apparently when President Obama said last night "the party was over," he wasn't just talking about consumer spending.
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Tags: economy | Barack Obama | consumers | economic stimulus | government intervention | Obama administration | Tim Geithner
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Reader Comments
Toxic Investments?
It's time the American taxpayers were told what the term "Toxic Investments" really means.
Before the money is spent, Mr. President, please explain to the American taxpayer what "Naked" Credit Default Swaps are. And then tell us why our tax dollars will be used to pay off the gamblers that bought them and bail out their lame-brained bookies that didn't have the sense to set reasonable odds nor have the resources to pay the bets themselves.
Guess what ?
Thats what happens when you say you have a plan and really dont. I believe the DOW ended down 4.6% today. A few more days of this and the DOW will be around 6000. Isn't it funny that the words change and hope mean nothing when that is all they are, words. What is the phrase....faith without works is dead. Everyone understands when someone is not fully upfront and honest about what they are doing. Lets see what happens when the US loses its triple A rating when it comes to bonds. All of this debt on the balance sheets has to be rectified somewhere. Maybe those internment camps that the representative from Florida wants in the stimulus bill will have a use after all.
Mary Kate
Mary Kate, you are right about the confidence factor. The problem is the Democrats have spent two years downing the economy and talking about how bad it is and will be. They are unable to inspire confidence. They have made too much political hay out of spreading doom. They are currently using doom to get their borrow and spend deal imposed on us.
As for some simple talk on banking let me offer this. The politicians and the bankers want us to take these "toxic" accounts (bad loans) off their books. That is, they want tax payers to pay off these bad loans. The foolish borrows and dumb bankers who made these loans will walk away and dump the loans on our children and grandchildren. We will pay for the credit card debts, the ill-conceived mortgages and other bad loans. How is this sensible or just. I am amazed that people don't see through this. It is the biggest scam I have ever seen.
O yes! "We must do something and now." That is the most used scam line of them all. I have a rule. I never buy what I have to buy now to get the great price. If it can't be bought tomorrow at that price then it never was a good deal. This stimulus package is a lemon that can only be sold if it is sold quickly before people catch on.
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