Tim Geithner Has It in for Sheila Bair


Behind Timothy Geithner’s babyface and teen-idol locks lurks a soul as manipulative and scheming as Angelina Jolie’s, according to a rather awesomely gossipy story from Bloomberg, which reports that “sources” say the New York Fed president and newly anointed Treasury secretary would like to push Federal Deposit Insurance Corp. Chairman Sheila Bair out of her job, which is supposed to last till 2011. Why does he hate her so? Sources say he thinks Bair “isn’t a team player” and that he became “increasingly wary” of her during some of their recent interactions, particularly during various negotiations with Citigroup. See, Bair wanted Wachovia to go with Wells Fargo during that whole contretemps, but she’d already promised Citi they could have it. Geithner was like — and we paraphrase, because of course we didn’t overhear but we get the sense this is how it went — “Way to go, lady, now Pandit is mad and he’s going to tell all of his friends, and no one is going to want to work with us.” And Bair was like, “But it is a better deal.” And he was like, “Whatever, word is bond.”

And overall he just really thinks that she’s been “too focused on protecting her agency rather than the financial system as a whole,” say the sources. Which means … what, exactly? Probably that she always had to hold up the distribution of billions of dollars to mismanaged banks with annoying hypotheticals, such as “If we give this bank this much money, and the worst-case scenario still occurs, will the FDIC actually be able to fulfill its duties and insure the amount it is supposed to be able to insure?” And Geithner was apparently like: “Hello! What are you doing with the math and the numbers! Citigroup needs billions of dollars! Snap snap! Hand it over, we haven’t got all day.” Yeah, we could see how that would be exasperating. Everything would go a lot more smoothly without someone like that around.

Geithner May Seek to Push Bair Out After Clashes During Crisis [Bloomberg]