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Turbo-Tim Gets Defensive About Deficit

Posted by Larry Doyle on May 22, 2009 6:00 AM |

After the biggest one day selloff in U.S. government debt in a long time, U.S. Secretary of the Treasury, Tim Geithner, got very defensive this afternoon about the explosive growth in the U.S. deficit. Bloomberg reported, Geithner Pledges to Cut Deficit Amid Rating Concern.

Well, perhaps Secretary Geithner could help Barack and team find more than .5% of his $3.5 trillion budget to cut as a start if he is serious about his pledge. Over and above that, Tim asserted:

that the rise in yields on Treasury securities this year “is a sign that things are improving” and that “there is a little less acute concern about the depth of the recession.”

Benchmark 10-year Treasury yields jumped 17 basis points to 3.37 percent at 4:53 p.m. in New York.  

With all due respect to the Secretary, perhaps he may want to review the fact that the overall Treasury funding needs in calendar 2009 will likely exceed the funding needs of 2006, 2007, and 2008 COMBINED. Additionally, he may want to have a chat with the governors of the Federal Reserve. In the minutes of the most recent Fed meeting, the consensus forecast for growth, unemployment, and inflation is worse than what the governors foresaw in January. Perhaps the Secretary may want to reconcile his statement with those forecasts.

Tim did hedge his bets and cover his flank by commenting that:

it’s still “possible” that the unemployment rate may reach 10 percent or higher, cautioning that the economic recovery is still in the “early stages.” 

I do not pretend to think that Geithner has an easy job, but ultimately the market and investors will more value a secretary, spokesman, or analyst who is truly credible than merely an administrative mouthpiece. In my opinion, Tim has a lot of work to do on this front.  


  • Mountainaires

    Oh, what a tangled web they weave, when first they practice to deceive….

    They’re not telling the truth to the American people, so when our debt is downgraded, the dollar sinks, and unemployment soars to depression levels this summer and early fall, what will be the excuse then?

    OT, this is amazing. I can’t believe he thought he would get away with this! Did he not know he married a serial bankrupter? Or did he deliberately try to hide it?

    Economics journalist, Edmund Andrews, the poor, poor victim of rotten banksters, who encouraged his need for greed, isn’t the FULL STORY.

    I have to say I read his article, and couldn’t summon even a momentary feeling of sympathy for the “economic” reporter over his spiral into debt. Frankly, I was amazed that anyone could; but whatever the case, he should have been reporting the fraud, not engaging in it. This is a case of a man who still hasn’t come to grips with his own emotional compulsion to blame others instead of taking responsibility–CLEARLY.

    Now, we discover that Andrews lied–a lie of omission, not commission, but a LIE nonetheless.

    So, his efforts to redeem himself with his book, will likely fail–and his marriage may well fail too–and he will be left with his reputation, as well as his fiscal situation, in tatters. This is a man who is self-destructive in the extreme, and who married a woman with the same problems.

    It’s a tragic story alright; but not a sympathetic one.

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