'Safe pair of hands' Timothy Geithner tipped for US Treasury From correspondents in Washington Agence France-Presse November 22, 2008 06:18pm Text size + - Print Email Share Add to MySpace Add to Digg Add to del.icio.us Add to Fark Post to Facebook Add to Kwoff What are these? TIMOTHY Geithner, tipped to be US President-elect Barack Obama's Treasury chief, will bring the experience of a Washington insider and a markets technocrat at a time of acute economic peril. The well-travelled president of the New York Federal Reserve has been at the sharp end of US authorities' battle to shore up panicky financial markets by overseeing the central bank's explosion of intervention in recent months.
The 47-year-old - who also serves as vice chairman of the policy-making Federal Open Market Committee - was key to the bailouts of insurance giants AIG and Bear Stearns, and in the decision to let Lehman Brothers collapse.
But he is also an old Treasury hand, having risen up the ranks of US government from 1988 to 2001 to the peak of undersecretary for international affairs.
"For all the currency traders out there, this means he was in charge of US dollar policy and is steeped in the nuance of the currency markets,'' Andrew Busch at BMO Capital Markets said.
"Unlike during rookies Paul O'Neill or John Snow's tenure, we won't get many mistakes to make easy money,'' he said, referring to President George W. Bush's first two Treasury secretaries.
Related Coverage Wall St rallies over new Treasury chief NEWS.com.au, 22 Nov 2008 US to plough billions into big banks NEWS.com.au, 28 Oct 2008 G20 summit to tackle finance crisis NEWS.com.au, 23 Oct 2008 China criticises West over crisis NEWS.com.au, 12 Oct 2008 Japan unveils new economic measures NEWS.com.au, 15 Oct 2008 Several reports said Mr Obama would unveil Mr Geithner as the incoming Treasury boss at a news conference on Monday, along with New Mexico Governor Bill Richardson as commerce secretary and other members of his economic team.
As the successor to Republican Henry Paulson, Mr Geithner would become the overseer of a 700-billion ($1.1 trillion) bailout package for distressed banks, which has failed to head off fears of a long and painful recession.
Well before the current crisis erupted in mid-September, Mr Geithner warned that the US and global financial systems were "going through a very challenging period of adjustment".
"The critical imperative today is to help facilitate that adjustment and to cushion its impact on the broader economy,'' he told Congress, calling for "substantial reforms'' to policy, regulation and oversight governing markets.
"The forces that made the system vulnerable to this crisis took a long time to build up, and the system will need some time to work through their aftermath,'' Mr Geithner said in one of his rare forays into the limelight.
