Geithner seeks new powers over financial companies

Treasury Secretary Timothy Geithner called on Congress today to grant him new powers to regulate huge financial companies like insurance giant AIG, whose failure would pose a grave danger to the U.S. financial system and the broader economy. Specifically, Geithner wants powers similar to those of the Federal Deposit Insurance Corporation, which has authority to seize control of banks, take over their bad assets and sell good ones to competitors. Federal Reserve Chairman Ben Bernanke, appearing with Geithner, agreed. He said the government’s bailout of troubled insurance giant American International Group Inc. underscores the urgent need to safely wind down financial giants on the verge of collapse and subject them to much stronger regulatory oversight.