We Needed This Under Bush

Update: Obama fields questions on offshoring, health care, jobs and so on. Hey, this guy actually believes in solving problems.

Geithner to Outline Major Overhaul of Finance Rules - Officials said the plan, which will be unveiled Thursday, will subject hedge funds and traders of exotic financial products to governmental supervision.

About time, so will critics of these unregulated exotic financial products now rule the airwaves?

And M. Shihid Alam asks 'what about the victims of financial markets?'.

But, one ought to note, even Nouriel Roubini (Dr. Doom) has good things to say about the Geithner overhaul. From Roubini's e-mail:

Nouriel Roubini (March 25): Finally, Geithner and Bernanke (see respective testimonies at AIG hearing on March 24) have come to agree about the need for a new insolvency regime for systemically important financial institutions (bank holding companies and non-bank financial institutions) in order to avoid another Lehman and expensive ad-hoc bailouts like AIG

Necessary features: A new conservatorship/receivership regime of insolvency could be similar to the one used to manage the orderly takeover of Fannie and Freddie. As soon as the stress test is done some large and systemically important banks (and their holding companies and non-bank financial arms) will have to be taken over. To do it orderly we absolutely need a special insolvency regime like the one we have for the bank arms of bank holding companies and similar to the one we have for Fannie and Freddie

On the other hand Paul Craig Roberts sees financial deregulation and offshoring (shipping American jobs overseas) as having done such tremendous damage to the U.S. economy that Obama's interventions and spending may be insufficent to bring us out of this recession, with one catastrophic result being the "depreciation of the US dollar and loss of its reserve currency role":

The enormous trade deficit that has been created by the pursuit of short-term corporate profits can only be closed in two ways. One is to stop the offshoring and to bring home the offshored production. Possibly, this could be done by replacing the corporate income tax with a tax based on whether value added to a company’s output occurs domestically or abroad.

The other way the trade deficit can be closed is by the inability of Americans to pay for imports. If debt monetization wrecks the dollar and drives up import prices, Americans will have to learn to live with less imported energy and manufactured goods. American annual consumption would shrink by the amount of the trade deficit.

Obama Scores

Why broadcast reporters do not comment on the erudition of Barack Obama v. the stammering ignorance of George W. Bush remains a mystery.

One thing is clear: Obama has made leveling with the American people an urgent priority.

Still, one wonders if the hollowed-out economy that Bush and his nihilists loosed onto Americans can be saved by Obama.

Obama is trying.

See Obama shoots back and scores - With a sharp retort about AIG, the president was on his game with the press, weaving through questions and driving home his economic plan. (Madden)

Obama Scaring GOP with Candor

As President Obama holds a prime-time news conference to further explain and defend his economic policies, clarity and specifics are now the pressing order of every day. [See also Rescue Plan, With Some Fine Print, Dazzles Wall Street.]

From the Obama White House blog:

Last week the President and the Treasury Department focused on ensuring that homeowners take advantage of the President’s Homeowner Affordability and Stability Plan to keep people in their homes and stabilize the mortgages that underlie the assets involved in the financial crisis. This morning the President and the Treasury unveiled the plan to unlock the credit markets, one of the most complex and intractable obstacles to economic recovery. Treasury Secretary Tim Geithner penned an extensive op-ed in the Wall Street Journal, and posted a detailed explanation of how the plan will function on the Treasury Department’s website. The President spoke to the press about the plan this morning after receiving the Economic Daily Briefing in the Roosevelt Room.

Obama is making good on his promises on energy and the environment as he pledges billions for renewable energy projects.

Look for a details-laden, plain-spoken and candid address to the public tonight in the press conference.

In the words of Ralph Waldo Emerson: "The world is upheld by the veracity of good men: they make the earth wholesome. They who lived with them found life glad and nutritious. Life is sweet and tolerable only in our belief in such society."

That's what Americans are looking for: Candor and commitment. And such virtues scare the holy hell out of the contemporary Republican Party.