Lender of last resort is not enough, says Geithner

geithner-tim
Tim Geithner

The idea that the Federal Reserve could have saved Lehman Brothers through more generous use of emergency lending amounts to “magical thinking”, according to former Treasury secretary Tim Geithner.

“I have not seen the credible case that lending up to the value, even generously determined, of available collateral, for a bleeding business, with its assets underwater, would have been effective,” said Geithner, who was one of the key US actors during the 2008 financial crisis.

Much debate since

To continue reading...

You need to sign in to use this feature. If you don’t have a Central Banking account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an indvidual account here: