Yesterday, treasury secretary Tim Geithner unveiled his trillion dollar plan to save the banks. It is buying of toxic assets from the banks using a private , public partnership where most of the matching for the dollar is provided by tax payer. The plan puts more pressure on tax payers and least exposure for the wall street guys. No wonder the wall street guys are cheering for it.

Four professors of economics presented there views in NY times.

Nobel prize winning economists, Krugman and Stiglitz are against it. Stiglitz goes further and says this plan is nothing but robbing the tax payers.
Now China has joined Russia in calling for a new global currency to replace the dollar, to avoid over exposure to any one single currency.

Update: Here is another well written piece on the plan by Martin wolf of financial times.

Advertisements

There is a clash between America and China brewing over the value of the Chinese currency. America wants China to strengthen its yuan. China being the highest stakeholders in US treasuries, the move favours the Americans. But China wants to deflate its currency to stabilize its weakening economy. Let us see what happens.

more here by AP.