Geithner’s link to Corrigan will be especially crucial in the months ahead. Corrigan was recently asked by a presidential policy group to form a panel charged with finding ways to protect the financial system. The group is expected to release its findings by the end of July—a rapid but necessary pace if the Street is to have an effective voice in whatever may be done to tamp down risk.

One way of looking at these relationships is that they put Geithner in the loop with people he must know if he is to get a handle on the maddeningly complex financial markets. Corrigan has decades of experience at the Fed and on the Street, and Thain, recently brought to Merrill after the firm wrote down billions in subprime losses, is one of the leading experts on mortgage-backed securities and other intricate financial instruments. You could even make a case that Geithner would be falling down on the job if he didn’t keep in touch with the Thains and Corrigans of the world. “People don’t understand how important those relationships are, especially when you’ve got to deal with complex and difficult situations,” Corrigan says. “Relationships are critical, and Tim has done a terrific job of developing those relationships.”

Corrigan says that they “talk about everything under the sun,” except for monetary policy. “He brings in groups of people. That includes, at times, some of his old Treasury buddies,” like former secretaries Larry Summers and Robert Rubin. “As I said, he has really worked at this networking thing I keep talking about.”

Of course, these aren’t exactly chitchats among people who meet casually at some South Street Seaport bar after work. This is networking between a central banker and the heads of the capital-hungry investment firms over which he holds sway. You might argue that Geithner’s relationship to his charges is even closer than the typical regulator’s. No other regulatory agency is in a position to loan crucial billions to the entities it monitors.

Certainly, Geithner’s friendship with Thain and Corrigan can’t do Merrill and Goldman any harm. One intriguing aspect of the Bear bailout—Geithner’s selection of BlackRock to help the Fed value Bear and then manage the $30 billion in collateral—draws attention to these relationships. Merrill owns 49 percent of BlackRock, which was spun off years ago from Peterson’s Blackstone Group. California Democratic representative Henry Waxman, chairman of the House Committee on Oversight and Government Reform, has asked Geithner to explain how BlackRock got the job, noting that such contracts are usually secured by a competitive bidding process. Geithner told the Senate Banking Committee on April 3 that the selection of BlackRock, which he described as a “world-class adviser” of exceptional expertise, took place amid helter-skelter decisionmaking at the time the deal was being worked out. He said that the compensation of BlackRock, whose board of directors includes Thain, had yet to be determined.

More broadly, the value of the bailout to taxpayers was a theme of the grueling four-hour interrogation of Geithner and other officials by the Senate Banking Committee. Again and again, the senators questioned whether the interests of Bear or the public were being served, and the adequacy of investment bank oversight was the subject of unusually close questioning. While the hearing seemed very civilized—the witnesses were not even sworn in—it rated a solid 6 on the congressional tension-meter, with 1 being an opening prayer and 10 being the Army-McCarthy hearings. Fed chairman Ben Bernanke, Treasury undersecretary Robert Steel (Paulson was conveniently in China), and Securities and Exchange Commission chair­man Christopher Cox also testified.

But it was Geithner who had the chore of providing the nitty-gritty, and he bore more than his share of the most pointed questioning. He was scolded, lectured, and interrupted, much like a doctoral candidate who had just presented a weak defense of his dissertation. “Should I try—can I just go through a few important things for the record,” he pleaded at one point in the midst of a barrage of hectoring by Republican senator Jim Bunning, of Kentucky. The New York Times splashed his beleaguered likeness at the top of the front page the next day, with Geithner staring down at the witness table, hand on head, lips pursed, as if saying to himself, “Why the hell did I take this job?”

It's a fair question, and so is this: How did a career technocrat become the king of Wall Street, capable of blessing mergers, starving unworthy firms of cash, and, if one believes the not-unpersuasive official narrative, saving the markets from ruin? The Fed is arguably the least transparent of the financial regulators, and although the Fed itself was created by an act of Congress in 1913 and the chairman of the Fed is a presidential appointee, pretty much everyone else wielding any power is a product of a kind of old-boy network. The presidents of the regional Fed banks are appointed by their nine-member boards of directors, with six seats on each board selected by member banks and the other three by the Federal Reserve’s board of governors.