So, the head of the FDIC is now starting to get laudatory coverage, the link is to CNN, just a week after Timothy Geithner leaked that he wanted her gone.

Needless to say, and the article points this out, her relationship with other regulators is very much like former CFTC chairman Brooksley Born, who correctly predicted the CDS train wreck, and was run out of town on a rail by Larry Summers. (Yeah, him again)

Also, we now know why Geithner wants her out:

And Bair is a mother bear about the FDIC. That has got her into hot water with the other regulators, who are more focused on stabilizing institutions like Citigroup and AIG. They didn’t like it when she reversed her position on a Citi-Wachovia merger in late September when Wells Fargo came in with a deal that alleviated the need for government help.

When Citi required a capital infusion last month, she stood firm about limiting the FDIC’s exposure, according to a person knowledgeable with the negotiations, and attached some conditions, for example requiring Citi to modify troubled mortgages along the lines of IndyMac’s program.

Her vigilance is less about ego than it is about protecting the FDIC and all that it stands for. Created by Congress in 1933 to restore public confidence in the nation’s banking system, the agency is funded not by the government but by fees from the bank whose deposits it insures. So it’s not a bottomless pit.

So, she appears to be the only one there who does not think that big banking are in fact a bunch of Ivy League educated geniuses who not only need to be bailed out, but she also disagrees that they should get a free ride on that bailout.

She objects to policies that puts the nation’s guarantees to depositors in jeopardy, and requires that the recipients do things that might cause short term damage to the balance sheet, and to their year end bonuses, but will benefit the companies and the nation in the long term.

Heresy!