Timothy Geithner Quotes

In September 2008, the overleveraged and undermanaged U.S. banking system suffered a terrifying collapse. And that, in turn, nearly took the whole country down.

As we try to make the financial system safer, we must inevitably confront the problem of moral hazard.

Unregulated derivatives like credit default swaps threaten our regulated markets, or indeed our economy without any Federal agency knowing about it.

I think people have to be very careful with new ideas [in fiancé and economics]. What you need to worry about is when you have something that’s a really good idea, but you get too much of it too fast, like over-the-counter derivatives.

We have institutions that have been allowed to become too big to fail because we had all kinds of flaws in our financial infrastructure, in the whole way over-the-counter derivatives work.

Don't act like a bank unless you are a bank. That was a really big lesson learned from 2008.

The financial industry may not be synonymous with economics, but it does control a large enough sector of the global economy to sink us all, as was unnervingly demonstrated in 2008.

Prior to the 2008 recession, many financial institutions were engaging in 'proprietary lending,' where a bank would invest funds for its own gain instead of earning revenue through commission by trading on behalf of clients.

The financial crisis revealed important weaknesses in many areas of our financial system.

One of the big problems we had during the financial crisis was the intermingling of banks and holding companies and complex securities.

The assumption that Washington could and would resolve Lehman Brothers without a bankruptcy, as it had Bear Stearns, was the single biggest mistake in the series of mistakes in 2007 and 2008 that led to the financial panic and the ensuing epidemic of job losses.

The banking collapse was caused, more than anything, by bad government policy and the total failure of bad regulation, rather than by greed.

If we are really serious about preventing another crisis like the 2008 meltdown, we should simply ban complex financial instruments unless they can be unambiguously shown to benefit society in the long run.

What the American people don't understand is how Merrill Lynch or AIG or Lehman Brothers can reward people, and the entity fails. Not only do the shareholders lose, but the entities lose.

The thought for a long time was that banks needed to be too controlled, too regulated to be turned over to the Wild West of the Net. Then the credit meltdown hit, and we saw just how reckless these so-called safe and regulated institutions were.

Imperceptibly, the developed world's manufacturing base was gradually eroding and being replaced by securitized finance that destroyed itself and nearly its economies in 2008.

I think the average American recognizes that it took years to create the crisis that erupted in 2008 and peaked in January of 2009. And it's going to take some time to work through it.

I and others were mistaken early on in saying that the subprime crisis would be contained. The causal relationship between the housing problem and the broad financial system was very complex and difficult to predict.

The heart of the 2008 financial crisis was a coterie of reckless financial executives, working for too-big-to-fail financial companies, who were handsomely compensated for taking risks that almost ruined the economy when they failed.

If the bankers knew so much about capital markets, how come they got into so much trouble.

The financial system is drifting back to business as usual a bit to quickly …. We are starting to see risky behavior of the sort that people were scared of after the crises

To be sure, booms and busts will come and go. But their severity can vary dramatically based on the policies in place to prevent them. With stronger regulations, neither the housing and derivatives bubbles nor the eventual crash would have been so bad.

… many, and arguably most economists were claiming right up to the moment of collapse, that nothing like this could ever happen.

We must limit the perception that some institutions are either too big or too interconnected to fail.

What we have to find is the right level of regulation of our financial system so that it has the incentive to invest in things, but at the same time, it is sufficiently regulated so it can't get in the kind of trouble that we have seen in the past and we have seen recently.