Net Net: Promoting innovation and managing change
Net Net: Promoting innovation and managing change

Did Tim Geithner Just Tell Jamie Dimon to Resign From the Fed?

Timothy Geithner

Treasury Secretary Tim Geithner appeared on PBS NewsHour Thursday night. Jeffrey Brown asked him whether JPMorgan Chase CEO Jamie Dimon should resign from the board of the Fed.

Here’s the answer:

TIMOTHY GEITHNER: Well, that’s a question he’ll have to make and the Fed will have to make. But again, on the basic point, which is it is very important, particularly given the damage caused by the crisis, that our system of oversight and safeguards and the enforcement authorities have not just the resources they need, but they are perceived to be above any political influence and have the independence and the ability to make sure these reforms are tough and effective so we protect the American people, again, from a crisis like this. And we’re going to, we’re going to do that.

The first thing that jumps out here is the Geithner did not categorically dismiss the notion that Dimon should step down. Imagine if the president answered questions about Joe Biden stepping down as his Vice President with a rambling paragraph that never got around to saying “no.”

Certainly, this is being interpreted by some very smart people as a signal that Geithner wants Dimon off the Fed board.

“In the diplomatic language of Treasury communications, Mr. Geithner just told Jamie Dimon to resign from the New York Fed board,” economist Simon Johnson writes at Baseline Scenario.

Over the past few years, Geithner has become very good at conveying his message. Unless there’s some serious back-peddling over the next few days, its safe to assume that Johnson’s interpretation is correct.

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