It's official. Today's rally was soley the result of Obama picking Geithner as the new Treasury Secretary. And here I was thinking this entire time it was something to do with the fact the market was down 20% in a week and triple-witching, or perhaps forced liquidation has settled (for now). Silly me.
“It’s a resounding ‘yes’ from Wall Street,” said Peter Kenny, managing director for institutional sales at Knight Equity Markets in Jersey City, New Jersey. “There’s confidence in a person who is up and coming and recognized as an authority on a very complex problem. There’s confidence in what he’s displayed so far, in terms of his leadership and management skill.”
Thurgy: Where have we heard this before? Oh, right. Bernanke and the Great Depression.
Obama’s nominations would need to be confirmed by the Senate after he takes office on Jan. 20. President George W. Bush’s Treasury secretary,Henry Paulson, has pledged to work with his successor during the transition. Summers, along with former Fed Chairman Paul Volcker, were cited as candidates for the Treasury job by people close to the Obama camp earlier this month.
Thurgy: Damnit, why not Volcker! What we need is some tough love. Not someone hell-bent on preventing deflation. What's this nonsense I'm hearing on television on delfation still just a 'remote' possibility? Your choices: Deflation or Hyper-Inflation. Both have pain, only one comes out with gain. Anyway, Paulson and Geithner have long been working together, you like the result?
As head of the New York Fed, Geithner has served as the central bank’s top liaison with Wall Street. Geithner oversaw meetings at his bank to attempt to head off Lehman’s failure in September, later hosting gatherings on how to resolve AIG.
Thurgy: Is this his credentials? Failing to head off a failure in Lehman and the soon-to-be failed AIG. Oh, those gatherings he hosted with AIG only included Goldman (yeah,old news). But he does speak Chineese, which is a HUGE plus right now. Perhaps this time instead of figuring out how to keep AIG afloat, maybe they can let them go bankrupt. It's the only way to avoid putting money into a bottomless pit with all the CDS they insure. Speaking of Goldman. Peculiar action when they quickly ran from 51 down to 47. Sizeable amount of the Dec 40 PUT were trading during this time. Does GS still have $20B in exposure to AIG in the event of a default? Or is GS price action a result of a possible Citi merger? TGLP?
