Geithner's Treasury

Obama reportedly goes for change--and experience.

	Timothy Geithner

In selecting a Treasury secretary, President-elect Barack Obama appears to have opted for candidate of both change andexperience: New York Federal Reserve Bank President Timothy Geithner.

If a report by NBC News turns out to be true, Obama will name Geithner and other core members of his economic team on Monday. Geithner, 47, has a boyish face, but he's an old hand on economic and financial policy and is no stranger to the current economic crisis. Since August of 2007, he's worked daily with Federal Reserve Chairman Ben Bernanke and current Treasury Secretary Henry Paulson in creating new mechanisms to funnel cash to ailing institutions.

"It'll be like being able to keep Paulson around a little longer from the president's point of view," says Robert McTeer, a former president of the Dallas Fed who has worked with Geithner. He likes the choice. Wall Street liked it too. The Dow Jones industrial average roared back on the NBC report, gaining almost 500 points. Thursday, the index closed at its lowest level since 2003.

A spokesman for the Obama transition team said they would not "comment on appointments before they're made, or on speculation." Officials from the New York Fed did not respond to requests for comment. If Geithner turns out to be his pick, it means Obama passed over several experienced hands who were considered favorites for the job, including former Treasury Secretary Lawrence Summers and former Fed Chairman Paul Volcker.

At Treasury, Geithner will be charged with the formidable task of leading the administration's effort to right the foundering U.S. economy. He'll have the remaining balance of the Treasury's Troubled Assets Relief Program--at least $350 billion--to dole out at his discretion to troubled financial firms.

In a sense, Geithner, like Obama, will assume his new position with a distinct advantage--much of the policy groundwork for reviving the economy has already been done for him (and in some cases, by him). Two months ago, Congress granted the Treasury secretary unprecedented authority in using the TARP funds to help the system. Treasury now has the authority to take equity stakes in banks and other companies, and it can control executive compensation in the firms in which it takes a share.

In recent weeks, a scrum of ailing companies, includingGeneral Motors (nyse: GM - news - people ), Ford Motor(nyse: F - news - people ) and Chrysler, have descended upon Washington to ask Uncle Sam for money. Some believe thatCitigroup (nyse: C - news - people ) and JPMorgan Chase(nyse: JPM - news - people ), which have already received the Treasury's help, will have to return for more. Geithner will have extraordinary power to determine which firms receive aid and which do not.