Impressions from Treasury

by on November 6, 2009 at 6:57 am in Economics, Political Science | Permalink

I will enumerate a few (you can trace other accounts here):

1. Tim Geithner is very smart and he was conceptually stronger than one might have expected.

2. I believe that the long, L-shaped hallways encourage "visits to offices" rather than hallway conversations; this is a speculation and perhaps some reader can confirm or deny it.

3. The quality of the painted portraits of Treasury Secretaries declines as time passes.

4. The free cookies were good and fresh, with a warm, fluid chocolate interior.  There was water to drink, but no mineral water.

5. For all their talk about outreach, etc. I believe at least a few of them wanted to hear from an outside source whether we think they are totally ****ed or not.  They heard. 

6. I worry less than did some of the other bloggers about the Treasury awareness of major economic problems going forward.  As governmental institutions go, Treasury has a real incentive to a) worry about the fiscal future, and b) worry about worst-case scenarios, including for financial institutions.  Their daily interaction with the bond market gives them a longer time horizon and a more economics-friendly perspective than most of their bureaucratic counterparts.  The problem is Congress.  For instance if someone at Treasury had a Yves Smith view of the banking system, they could not much act on it.

7. "You guys are a welcome change of pace," or something like that, remarked one senior Treasury official.  Although this was flattery, I believe it was meant sincerely.  They were also a welcome change of pace.

8. I asked one senior Treasury official which book, thinker, or economic theorist had most shaped his thinking about the financial crisis.  In the ensuing discussion the book Lords of Finance was recommended, though I could not say whether it was intended as a totally direct answer to the question as stated.

josh November 6, 2009 at 7:59 am

You were there to be flattered, mon frere, and to consider these guys a “welcome change of pace”.

babar November 6, 2009 at 8:27 am

but don’t you wish you could visit the Paulson treasury?

Joseph Lawler November 6, 2009 at 9:27 am

I assume that by “conceptually stronger than one might have expected” you mean “didn’t literally hand bags of cash to his friends right in front of us.”

Andrew November 6, 2009 at 10:02 am

I think it is more about “free cookies…I looooooooove you!”

It seems people will never understand it is about what the money is spent on. Finance is just the method to make funneling the money to stupid projects more efficient.

Did anyone tell them, “Just tax the mess out of us.” I’m not a big fan of letting rapists think they had my permission.

Oh, and those of us who said there was nothing special about banks being insolvent were right. It’s not a matter of whether the stress tests were stressful enough. It is that they were pointless. “But, but, but (breathless panting) banks in a downturn might have impaired capital!” Yeah, and?

My only question is whether or not the government does this on purpose to accentuate the ratchet effect, or is it just a pleasant by-product.

Andrew November 6, 2009 at 10:41 am

Having an especially smart fox guarding the hen house may not be a plus.

david November 6, 2009 at 11:06 am

@anon

Yes, because throwing the rascals out has worked so well in the past.

Meet the new boss, same as the old boss…

keysh November 6, 2009 at 11:44 am

“Lords of Finance” was the final answer or the only answer?

Paul Johnson November 6, 2009 at 12:02 pm

The first thing you learn working in a place like Treasury is that you never give a direct answer about anything to an outsider.

Brian November 6, 2009 at 12:40 pm

Wow, a special visit to the treasury, in the midst of once in a generation Recession, and your first 7 “impressions” concern who is patting who on the back, and cookies. …. sounds a lot like what Homer Simpson would be thinking when he goes into the board meetings at the plant.

Right Wing-nut November 6, 2009 at 1:13 pm

Keith:

Is that like having honest crooks?

Andrew Berman November 6, 2009 at 2:08 pm

I’m glad Geithner was conceptually stronger than (you) might have anticipated. I’m still concerned about his motivations. As an example, his boss gives off the aura of being conceptually very strong, but often seems to be motivated to do the wrong thing.

djt November 6, 2009 at 4:13 pm

re: #8

if someone has read an economic history piece that better details the confluence of politics, power, and orthodoxy on economic decision making i would purchase it on the spot. that’s one heckuva book.

mulp November 7, 2009 at 1:53 am

The meeting sounds like some meetings I was involved with when in sales support situations; I was one of the technical people talking with good customers without knowing exactly what the salesman was trying to sell them, nor exactly what problem they needed to solve, but I was one of a bunch of engineers trying to connect with them to make them like us, and buy more stuff.

I would listen to the back and forth, and offer comments that were vague, but substantial enough to what I thought they were asking or say, trying to clarify or correct what my peers were saying. I also had to mind what I said because I didn’t know the NDA status.

Occasionally I’d get to have drinks with the sales tech or even the customer tech guys, and get a chance to connect and to offer more info, but that was rare. Sometimes, it was a waste of time. Generally, I’d get the deal afterward, and it would make me appreciate what I did as mattering to both my employer and the customers.

After all, the IBM or Google wants to know its customers, serve them, and be liked by customers. Perception matters a lot more than it should, perhaps. I bet you have two feelings about IBM and google, and while I would expect both would be positive, IBM is likely button down and google a bit cuddly in comparison.

The term some would use for this is transparency.

Andrew November 7, 2009 at 6:23 am

When can we expect the Treasury officials to post their impressions of the bloggers?

“They asked pretty mundane questions, mostly about the cookies, but generally had unkempt hair and didn’t bring any Starbucks.”

Superheater November 8, 2009 at 5:54 pm

Tim Geithner is very smart.

If we stipulate that to be true, so what? There’s plenty of evidence he’s very corrupt too.

reflex bag March 11, 2010 at 1:12 am

There are certain things you must understand about bonds before you start investing in them. Not understanding these things may cause you to purchase the wrong bonds, at the wrong maturity date.

The three most important things that must be considered when purchasing a bond include the par value, the maturity date, and the coupon rate.

The par value of a bond refers to the amount of money you will receive when the bond reaches its maturity date. In other words, you will receive your initial investment back when the bond reaches maturity.

outdoor towel warmer March 18, 2010 at 6:48 am

There are certain things you must understand about bonds before you start investing in them. Not understanding these things may cause you to purchase the wrong bonds, at the wrong maturity date.

Special Gift For Mom June 12, 2010 at 9:37 pm

Nice, Tim Geithner so smart, I think he can make a unique concept..

Alex March 2, 2011 at 9:20 am

I wanted to make a tourism website for spanish people to let them know how many interesting things we have here in the US. Managed to find a domain name (typed dominios in google.es and looked at the best offers) then set up hosting. Now after 20 posts I’m out of ideas…. what do you think I should write about in my following articles ? Check out top XX destinations in the US ? would that cut it ?

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