Government sources tell Time Magazine - the Administration’s long-awaited plan to save America’s banks is being delayed ‘again’. Apparently, the cause of this latest delay consists in the Treasury Department’s difficulties, or should we say - inabilities at this point, to create a proposal on financial reform that will help banks clean up toxic assets from their balance sheets through a partnership between private investors and the feds.

Administration officials are urging patience and insist they are moving faster than anyone has tried to do before. However, the reality is - the Department’s version of the plan, initially introduced by Secretary Geithner in mid February, has faced challenges from the start and more importantly - so far it has gone nowhere, at a time when urgency is imperative and needed to bolster the financial system.

Geithner, notes the Time has been burdened by thin staffing as he tries to get nominees to the Senate who can pass muster. But let’s face it. That’s not really an objective excuse for someone in charge of such an important department at  such a critical time with the U.S. economy confronting its toughest financial crisis in the last seven decades. Geithner’s responsibility is not to delay ; his obligation is to give a detailed plan in clear terms of how we are to proceed. Something he keeps failing to produce. The slip(s) is embarrassing for Treasury officials who have been assuring the media and the markets that the plan was coming. We simply can not continue to respond to market pressures for recapitalization without a specific, well-defined and coherent restructuring or rehabilitation program.

But then again, Geithner’s disappointments didn’t just start with his tax problems. They continued with his incomplete Feb. 10 proposal intended to relieve banks of their toxic assets and was heavily criticized for not providing a detailed plan in clear terms or explaining for that matter, how the program would work. As recently as March 14, Geithner again told Bloomberg TV he would release details of his plan soon, adding the Treasury already is well on its way to starting “a dramatic lending program to help securities markets get flowing again.” Further complicating the matters, besides the latest delay and the uproar over AIG an their bonus structure, is now the International Monetary Fund’s [IMF] latest report - released Thursday (3/19).

The IMF said in the report, prepared for a meeting earlier this month of finance ministers from the Group of 20 nations: “Geithner’s plan to fix the financial system lacks “essential details”…Critical details concerning the valuation of distressed assets remain unclear…The plan also does not address how severely undercapitalized or insolvent banks will be resolved or clarify the role of the vehicle that will hold the government’s preferred shares….More specifics will be needed to calm frayed market sentiment.” [Bloomberg]

It seems Geithner’s Treasury Dept., at least from a reputation perspective has started at this point a seemingly irreversible downhill slide. Let’s hope they don’t make the economy part of it. With such performance we won’t be able to get banks working again, which makes it an essential element in any economic recovery. And more importantly - we will not manage the crisis or see a gradual improvement in credit conditions, unless we immediately put together an effective program for valuing and disposing of toxic assets, and remediate banks and financial institutions as necessary.