Sense on Cents

We learned all we need to know about the economy today. How so? The fact that Treasury Secretary Geithner has chosen to extend the TARP (Troubled Asset Relief Program) to October 2010 is a clear indication that our economy, primarily housing and employment, needs Uncle Sam’s support.

While Geithner couches this support in terms of “just in case,” we should not be so naive. The American Banker highlights this development in writing, Treasury Extends Tarp to 2010:

The Treasury Department announced Wednesday that it would extend the Troubled Asset Relief Program to Oct. 3, 2010.

In a letter to lawmakers, Treasury Secretary Tim Geithner cited improvements in the economy but said Tarp must be extended due to remaining challenges for homeowners and small businesses.

That’s right. The outlook for housing and jobs remains challenged, all assertions to the contrary aside.

“This extension is necessary to assist American families and stabilize financial markets because it will, among other things, enable us to continue to implement programs that address housing markets and the needs of small businesses, and to maintain the capacity to respond to unforeseen threats,” Geithner wrote.

Unforeseen threats? Come on, Tim. Be straight with us. Try ongoing bank failures due to losses on loans. (more…)