President Obama, as this article reveals, is encountering problems on Wall Street in shaping his own policy.
But of course. He lost control at the beginning when he let Geithner and Summers write big checks to save Wall Street without at that time taking management control.
Was he so naive or did he trust the Geithner/Summers team too much.
Remember what his critics, including me, were saying. To reform Wall Street you need to put in proper control to safeguard taxpayers $$, to get a decent return on taxpayers' de facto investments in saving Wall Street. That could only mean one thing -- Obama had to temporarily "nationalize" those needing public money. But he got bad advice and he got cold feet when the totally cynical and hypocritical Republican Party were labeling him a "Socialist". After all, the lackadaisical look-the-other-way Republicans allowed Wall Street to help create a giant bubble that caused havoc to all of us.
Paul Volcker, an advisor to Obama and former Fed Chairman, among others strongly recommended a temporary nationalization. It was known as the Swedish "model".
During a previous banking crisis, Sweden temporarily nationalized the banks and then re-privatized them after working out their balance sheet loan problems. Volcker and others were marginalized by Geithner/Summers. Geithner famously dimissed that suggestion on TV: "United States is not Sweden."
So the inevitable happens. Obama now needs Wall Street's cooperation more than the latter needs his. Why?
Wall Street already cashed those hundreds of billions worth of checks.
Thank you Uncle Sam. We on Wall Street will call you to let you know how we plan to move forward.