Can we survive 57 more days?

Gail Collins half-seriously suggests that Bush should resign now. Thomas Friedman suggests that Bush should immediately replace Treasury Secretary Hank Paulson with Obama's apparent choice, New York Federal Reserve chief Timothy Geithner. Friedman also writes:

“A great judgment has to be made now as to just how big and bad the situation is,” says Jeffrey Garten, the Yale School of Management professor of international finance. “This is a crucial judgment. Do we think that a couple of hundred billion more and couple of bad quarters will take care of this problem, or do we think that despite everything that we have done so far — despite the $700 billion fund to rescue banks, the lowering of interest rates and the way the Fed has stepped in directly to shore up certain markets — the bottom is nowhere in sight and we are staring at a deep hole that the entire world could fall into?”

If it’s the latter, then we need a huge catalyst of confidence and capital to turn this thing around. Only the new president and his team, synchronizing with the world’s other big economies, can provide it.

“The biggest mistake Obama could make,” added Garten, “is thinking this problem is smaller than it is. On the other hand, there is far less danger in overestimating what will be necessary to solve it.”

All signs so far are that Obama sees the problem as a big one and plans to respond aggressively.

PAUL MCCULLEY AT PIMCO has an interesting, though not easily summarized, article about the nature of banking. Banks, he says, are a hybrid organization: part private, part public. Banks can essentially make more loans than they have deposits, and that leverage underlies our economy. But they can only do so because an external entity--the government--offers some guarantee that the overall system will remain solvent.

Right now we're experiencing the pain brought on by a period of particular excess in the banking industry. And whether we like it or not, a socialization of some of the banks' bad decisions is required.

One more potential example: Citigroup.

Today, Citigroup, once the nation’s largest and mightiest financial institution, has been brought to its knees by more than $65 billion in losses, write-downs for troubled assets and charges to account for future losses. More than half of that amount stems from mortgage-related securities created by Mr. Maheras’s team — the same products Mr. Prince was briefed on during that 2007 meeting.

Citigroup’s stock has plummeted to its lowest price in more than a decade, closing Friday at $3.77. At that price the company is worth just $20.5 billion, down from $244 billion two years ago. Waves of layoffs have accompanied that slide, with about 75,000 jobs already gone or set to disappear from a work force that numbered about 375,000 a year ago.

Burdened by the losses and a crisis of confidence, Citigroup’s future is so uncertain that regulators in New York and Washington held a series of emergency meetings late last week to discuss ways to help the bank right itself.