Tim Geithner, This Mess Is Yours

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Stocks surged roughly 500 points in the final hour of trading today, on reports that New York Fed President Tim Geithner will likely become the next Secretary of the Treasury when Barack Obama takes office at the end of January.

What's it mean for investors? Apparently, something good. During these tumultuous times, markets loathe even the slightest bit of uncertainty, so just getting confirmation that someone has the guts to take the position was enough to pop the champagne bottles and spark a rally. Rumors have been swirling for weeks over who'd take former Goldman Sachs (NYSE: GS  ) CEO Hank Paulson's job -- a gig that's undoubtedly as important as it's ever been.

Other apparent candidates included JPMorgan Chase (NYSE: JPM  ) CEO Jamie Dimon, and former Treasury alumni Robert Rubin and Larry Summers. Although it was never taken very seriously, some even suggested that Warren Buffett should have been tapped. "The answer is I wouldn't give up my job," Buffett said today. "I'm glad to help in any way I can, but I would not do it."

One huge benefit in selecting Geithner is that he was front and center at the New York Fed during the Bear Stearns, AIG (NYSE: AIG  ) , and Lehman Brothers fiascos. That experience should come in handy. As Citigroup (NYSE: C  ) continues to look sketchier by the day, it's not crazy to think we'll see more last-second Wall Street bailouts in the coming months.

For the first time in a while, the Secretary of the Treasury will be one of the president's most important cabinet members. What do you think about the pick? Take a second to weigh in via the Fool poll below, and share your thoughts in the comment section if you feel so inclined.

Fool contributor Morgan Housel doesn't own shares in any of the companies mentioned in this article. JPMorgan Chase is a Motley Fool Income Investor recommendation. The Motley Fool is investors writing for investors.

Read/Post Comments (4) | Recommend This Article (10)

Comments from our Foolish Readers

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  • Report this Comment On November 22, 2008, at 12:38 AM, mlaursen wrote:

    I'm not thrilled. Geithner's a protege of Kissinger. And his current job, essentially, is to preside over inflation of the dollar by virtually printing money.

  • Report this Comment On November 22, 2008, at 2:04 AM, Daretoth wrote:

    So, low interest rates, too much printing, and too much spending got us into this mess, and we pick one of the guys who has been doing just that. Yeah...great choice Obama. I like how you are bringing new blood to murdering the our hopes and dreams.

    My hope bleeds for you,


  • Report this Comment On November 22, 2008, at 3:54 PM, whereaminow wrote:

    Change is so refreshing isn't it? Are Obama's hard core supporters still delusional about the change he is bringing to Washington, or are they waking up to the fact this clown is no different than Bush, Clinton, McCain, Pelosi, Reid, and every other jackass up in Washington.

    Let's see, the Federal Reserve monetary system is at the heart of our current financial crisis, and the Fed's inflationary policies induced the malinvestment that exacerbated this crisis. So, in order to bring change to the administration, Obama promotes from within the Fed. Hmmm... sounds suspiciously like the status quo to me.

    But hey, what do I know? I'm not in Washington, so it's impossible that I could know what I'm talking about.

    Viva Von Mises!

  • Report this Comment On November 23, 2008, at 11:45 AM, my2cnts wrote:

    We are are in a big mess that started about eight years ago. Doing nothing but pillaging tax dollars for eight years is what got us here today. I am sure most of you can remember what the economic focus was ten years ago. And wow how it changed in eight years. Lack of foresight and logical thinking by people put in the wrong positions for eight years was a major contributor to the current situation. And now the American people have voted for a new president. With this new president there will be a change of the current members of government that have for the last eight years failed to do there job well enough for the American people. Everybody wants to point fingers but it was the American people that voted for the wrong people for the last eight years. And it is the American people's problem. The American people put there trust into the president to make decisions, good decisions logical decisions, decisions that will be beneficial to the American people. Lets trust the new president has made a good logical decision. As we all know the last one didn't.

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