Good-bye Secrecy We Hope

U.S. Planning to Reveal Data on Health of Top Banks (by David E. Sanger and Eric Dash, NYT):
"As it tries to restore confidence in the financial system, the Obama administration is preparing to disclose the conditions of the 19 biggest banks in the country."

Worth noting that Roubini says we ought to consider taking reported U.S. Bank Earnings in the first quarter with a pinch of salt.

Toxix Assets and Winston Wolf

Update III: Geithner seeks new powers over financial companies

Update II: The President and the Treasury Department unveil the plan to get credit flowing to working families again by bringing stability to the financial system.

Update: Frank Rich Warns of a ‘Katrina Moment’

Treasury Secretary Timothy Geithner and the rest of Obama's recovery team need to demonstrably channel Winston "I-Solve-Problems" Wolf, the fast-acting, hyper-efficient fix-it man from Pulp Fiction (1994, Quentin Tarantino).

News from today' Times (Toxic Asset Plan Foresees Big Subsidies for Investors) is spot-on in this needed Wolfian aspect of Obama's recovery plan.

From Edmund L. Andrews, Eric Dash and Graham Bowley.:

Treasury Department is expected to unveil early next week its long-delayed plan to buy as much as $1 trillion in troubled mortgages and related assets from financial institutions, according to people close to the talks. The plan is likely to offer generous subsidies, in the form of low-interest loans, to coax investors to form partnerships with the government to buy toxic assets from banks.

Long-awaited is right. We believe Obama is on this, we understand the repercussions, so thank you for bringing in the cleaners now.

"You're sending the Wolf? Shit, negro, that's all you had to say."
- Jules (Samuel L. Jackson)

As for congressional Republicans and any Democrats who resist soaking up this trillion-dollar toxic pool, as the Wolf said: "I'm here to help. ... So pretty please, with sugar on top, clean the *&%$ (mess)."

Wall Street in Wonderland

Growing Worry on Rescue Takes a Toll on Banks (Eric Dash, NYT) reads the headline emblematic of conventional wisdom as "fears of nationalization and of Washington’s ever-changing plans for the nation’s beleaguered banks have sapped investor confidence in the industry."

The banks want the taxpayers' money, but the taxpayers, even temporarily, ought to have none of the prerogatives that ownerships confers, say the large investors.

That's not a winning political slogan, and Obama should hit this nonsense out of the park, soon.

So a little perspective is in order, go Krugman:

So everyone agrees that fears of nationalization are driving bank stocks down. That’s probably true, but those fears have to be carefully interpreted.

We are not talking about fears that leftist radicals will expropriate perfectly good private companies. At least since last fall the major banks — certainly Citi and B of A — have only been able to stay in business because their counterparties believe that there’s an implicit federal guarantee on their obligations. The banks are already, in a fundamental sense, wards of the state.

And the market caps of these banks did not reflect investors’ assessment of the difference in value between their assets and their liabilities. Instead, it largely — and probably totally — reflected the 'Geithner put', the hope that the feds would bail them out in a way that handed a significant windfall gain to stockholders.

What’s happening now is a growing sense that the federal government, in return for rescuing these institutions, will demand the same thing a private-sector white knight would have demanded — namely, ownership.