The Geithner Put

How to make billions by getting the Obama administration to cover your losses:

Sachs calls it right:

But under the Geithner-Summers plan the loan is precisely designed to be a one-way bet, for the purpose of overpricing the toxic asset in order to bail out the bank’s shareholders at hidden cost to the taxpayers.

It’s one thing to spend hundreds of billions bailing out bank management, stockholders and bondholders. It’s another thing entirely to give away even more to politically-connected investment firms just to disguise the fact that you’re holding the banks harmless for their foolishness.

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