Geithner: Wall Street Is Safe Again

Salary caps will be dropped, but bonus restrictions remain

(NEWSER) - The Obama administration has scrapped plans for salary caps at banks and other firms that receive government bailout money, reports the Wall Street Journal. But congressional limits on bonuses will remain in force, and the White House will still push for major changes to executive compensation. The double whammy of executive and legislative pay provisions had spooked Wall Street and pushed 10 banks to repay $68 billion in TARP money yesterday. More»

Treasury sec reluctant to free Goldman, others from constraints

(NEWSER) - Tim Geithner is warning Wall Street that he will consider more than banks' individual financial fitness when deciding whether they can pay back bailout funds—and escape from the strings attached to them. In an interview with the Wall Street Journal, the Treasury secretary says that the whole banking system, and in turn the wider economy, has to be considered before he'd allow Goldman Sachs, JPMorgan Chase, and others to pay back their debts. More»

(NEWSER) - The Obama administration has devised a maybe-legal method of avoiding Congress’ restrictions on companies that accept bailout funds, including limits on executive pay and a requirement that taxpayers get an ownership stake in the firms, the Washington Post reports. To sidestep the restrictions, the administration has created special entities to act as middlemen between the government and the firms it aims to help. More»

(NEWSER) - All the hubbub around AIG and its bonuses is “a complete farce,” Larry Kudlow writes in the National Review. No one should be surprised that those in charge have “completely bungled” the situation. “The government shouldn’t run anything, because it cannot run anything,” Kudlow writes. And the Obama administration was “undoubtedly informed” about the bonuses months ago. More»

Treasury secretary resists calls for firmer government intervention

(NEWSER) - Treasury Secretary Timothy Geithner has prevailed over top administration officials who sought tougher restrictions on financial institutions in the revamped bailout plan to be unveiled today, reports the New York Times. Geithner, pointing to failures in countries that adopted more interventionist measures, successfully resisted calls to dictate how the cash is spent, to oust execs at bailed-out banks, and to broaden limits on executive pay. More»