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Obama's US economic jolt
Will the US president-elect and his team prove adept at tackling the finance crisis?
Last Modified: 25 Nov 2008 20:36 GMT

Will Obama's team manage to calm markets more effectively? [GALLO/GETTY]

Barack Obama, the US president-elect, is stepping into a yawning power vacuum in Washington DC in an unprecedented effort to restore confidence in the financial system.

"The truth is, we don't have a minute to waste," Obama has said.

"Right now, our economy is trapped in a vicious cycle: The turmoil on Wall Street means a new round of belt-tightening for families and businesses on Main Street – and as folks produce less and consume less, that just deepens the problems in our financial markets."

Obama said the economy needs a "jolt" - a whopping stimulus package to put people back to work, fix the crumbling public infrastructure and develop clean energy sources.

What he might have added is that the current president needs a jolt to wake him from his irresponsible slumber.

A rare bird

Bush, right, seems to have been largely
absent from the public eye [AFP]

George Bush has checked out early, it seems.

Instead of bearing down 24/7 on dealing with the worst economic disaster in almost a century, the 43rd president has virtually disappeared from public view.

There was a brief sighting of this rare and odd bird over the weekend.

Where?

In Peru, that is right, Peru - dressing up in a cute poncho for a photo opportunity at the largely irrelevant Apec summit in the Peruvian capital, Lima.

Obama, however, got to work.

He has assembled a fairly high-powered economic team in a very short time.

But the team is not without its flaws. Lawrence Summers, named as Obama's new chief economic advisor, was treasury secretary in the late phase of the Bill Clinton administration.

He acquiesced in the fatal decision to repeal the Depression-era, Glass-Steagal Act, which allowed banks and brokerage houses to begin promiscuously inter-marrying and cooking up the absurdly complex derivatives and other such financial hocus-pocus that led, inevitably, to the collapse of the housing market.

Meltdown questions

Meanwhile Timothy Geithner, the prospective US treasury secretary, has been deep in the middle of the current administration's efforts to cope with the meltdown.

Can he explain why banking giant Lehman Brothers was allowed to fail, the single most destabilising event of the crisis?

What did he do - or what should he have done -  to prevent the greedy binge of subprime mortgage lending and securitisation?

Those questions will, no doubt, come up during congressional confirmation hearings.

In the meantime, although Obama said earlier that the country can have only one president at a time, he looks like the only leader the country has got right now.

Source:
Al Jazeera
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