TARP 2.0 – the ‘Geithner plan’

As I’ve blogged before, I’m skeptical of Treasury Secretary Tim Geithner’s idea that the private sector will buy up toxic bank assets.

I’m also skeptical of his “stress test” to deal with bad, or baddish, banks.

But, Geithner’s “stress” test is sure to be kind and gentle enough to avoid a Sweden situation, since he and puppetmaster Larry Summers are adamantly opposed to this.

And, speaking of that, why does everybody keep talking about the “Geithner plan”? There's no way this is primarily his plan.

Also, if Geithner really was the “indispensable man,” vis-à-vis his Senate confirmation and his tax problems, he sure doesn’t have a high level of certainty about his plans.

Nor does Summers, who’s been around longer.

Here’s a “tough love” plan that combines certain aspects of nationalization and a “bad bank” idea, an idea which Summers and Geithner also have rejected so far.