Friday, April 15, 2011

Libya's Rag Tag Group of Corporate Rebels

Robert Wenzel of Economic Policy Journal queried the purpose of the meeting between Treasury's Tim Geithner, State's Hillary Clinton and Defense's Bob Gates on April 11.  I commented:

My guess is Libya. They need to discuss how to support Libyan rebels, a surprising rag tag group of corporate experts:

Wenzel found the likely reason for the meeting, via Bloomberg.

Libyan rebels want to borrow at least $2 billion to buy food, medicine, fuel and perhaps weapons as their foreign allies agreed on the need to do more to help them prevail over Muammar Qaddafi’s forces.

Members of the so-called Libyan contact group said in a statement in Qatar that they may create a “temporary financial mechanism” to finance the rebels using Libyan government assets frozen abroad.
Tim Geithner let Arab Banking Corporation continue operating, despite 59% Gadhafi ownership.  The Carlyle Group never said how much Libyan Investment Authority capital it holds.  Surely, current Libyan assets are levered in some manner.  How many times can people borrow on the same Libyan collateral?