Well that's what  Bloomberg recommends. The market values them at 30 cents on the dollar, “But that 30 cents is going to look good in three months. [Later this year ...] those assets will be going for five cents or 10 cents on the dollar. Absolutely they [the Treasury] should move faster.”

Move faster so we can buy them and take the loss? Geithner may be sure that buying those assets now will turn the economy around and stop the loss in values. But that's a huge risk to take with our money. Look, the big banks took this risk trying to make a fortune. They lost. They should live with that. But we need them and they're not functioning. What should be done?

We should take them over, clean them up and re-privatize them—like we did with the bad savings-and-loan banks under Reagan. But our laws may not allow this yet, because the banks claim to be solvent (they say the market is wrong and their assets are worth twice that much). Basically the banks are holding us hostage.

They're saying "You can't take us over because we say we're solvent, but no one believes us, so we can't function. You're country is sliding into a depression. You better better pay us way above market price for our trash assets, or we'll bring you down with us." Geithner, seems to think he has to go along. But at a minimum he should tell us what's happening, and I'd rather see him go for the maximum.

As Krugman explains, this could be a bank panic—just psychology, or it could be the banks are insolvent. The market for toxic assets is saying "insolvent," and Krugman agrees. Geithner says their assets are good—just you wait and see.

Why the disagreement? Geithner thinks he can turn the economy around fast enough to restore the housing market and make the bank assets valuable again. There's always a chance. That would save the bankers, the economy and Obama.

But, this is an unruly world recession, Geithner will probably lose. Go the other way, and some banks and bankers get sacrificed for sure—fine with me—so Geithner can't have his triple win. But this would improve the chances for the economy and Obama.

The recession has knocked over $25,000 per person off the value of stocks. Obama's carbon cap-tax, which is refunded except for $15 billion spent on green energy projects comes to $50 per person per year.

At that rate, it will take 500 years to cost as much as the stock-crash has so far. In fact, stocks lost 4% today, which is $280 billion in value -- the cost of more than five years of green energy projects. But the big difference is that switching to green energy is a little more useful than melting down the stock market.

So why are extreme Republicans (not most of them) going bananas over this tiny bit of spending on green energy—its only the amount we've been spending on space research year after year. As an economist, I'd have to ask—who's losing money. The fossil fuel companies, of course. But I don't believe that's it. I think most extremists just don't want to see our government do anything useful, because they hate our government.

The total value of U.S. stocks was above $15.1 trillion at it's peak and they've lost over half their value.

GDP dropped at it's fastest rate since 1982 in the last quarter of 2008. Why? Mainly because consumer spending dropped faster than at any time since record-keeping began. But supply-side economics says: "That's no problem. When people buy less, business cuts prices, and people buy more at a bargain price. Markets are wonderful."

Economists call spending "demand." Demand-side economics says: "When people buy less, business can't sell, people get laid off, and laid-off workers buy less. It's a vicious cycle. Markets are good, but can have problems." Demand-side economics is about what to do when there is such a problem. Spending is needed to get people back to work. But we can't order people to spend.

Two ways to increase spending: (1) the government can spend on projects (but they better be quick-start projects not a new mass-transit system), and (2) the government can give money to people to spend. Poor people and those out of work spend the most when you give them money. So cut low-income taxes and raise unemployment benefits. To get the money to spend, the government can borrow, or it can tax the rich. Tax $100 from the rich, and they will cut their spending very little—they're rich. Give that $100 to the poor, and they will spend almost all of it and save very little.