Nobel laureate Joseph Stiglitz continues to hammer away at the Obama administration and his appointees over how they’ve gone about the bailout so far.
In an interview with Bloomberg, Stiglitz specifically criticised the White House’s connections to Wall Street.
“All the ingredients they have so far are weak, and there are several missing ingredients,” Stiglitz said in an interview yesterday. The people who designed the plans are “either in the pocket of the banks or they’re incompetent.“
The Troubled Asset Relief Program, or TARP, isn’t large enough to recapitalize the banking system, and the administration hasn’t been direct in addressing that shortfall, he said. Stiglitz said there are conflicts of interest at the White House because some of Obama’s advisers have close ties to Wall Street.
“We don’t have enough money, they don’t want to go back to Congress, and they don’t want to do it in an open way and they don’t want to get control” of the banks, a set of constraints that will guarantee failure, Stiglitz said.
He went on to rehash a lot of conventional cricism, such as the revolving door between Wall Street and Washington and the fact that a company like PIMCO, which is a big bank bondholder, is the most likely to sign up for the PPIP.