According to our Matt Cooper, Gregg called New Hampshire Gov. John Lynch (D) a few hours ahead of releasing his withdrawal statement to alert him. But the White House appeared blindsided by the Gregg withdrawal, according to various reports, so much so that some officials were first learning of the news from reporters.

A Democratic Hill staffer writes in:

It’s hard not to think that Gregg’s withdrawal, with the grumbling about the census and the stimulus, was not timed to cause the most damage possible to the Obama administration. Releasing the statement just as Obama took the stage in Peoria was clearly designed to undermine the President’s event. The fact he scheduled a presser only seems to confirm it. The classy exit would have been to wait til tomorrow afternoon to quietly bow out. Basically Gregg decided not just to politely decline, but rather to blow shit up and burn the bridge behind him. Do not think this portends good things for the wider political climate.

If the larger GOP strategy can be describe as putting all of their chips on “FAIL”, this has to be seen as a significant addition to that pile, no?

Late Update: For his part, Gregg said at a press conference just now that he gave the White House “fair warning” of his withdrawal.

As I mentioned earlier in the week, former IMF chief economist Simon Johnson, who now teaches at MIT, brings a slightly different perspective to the U.S. banking crisis, that of someone who has studied and been involved with resolving financial crises in developing nations. From that perspective, a key step in permanently resolving the crisis involves wresting control of the banking system from the elites who were at the helm when the crisis occurred, a step, Johnson argues, that neither the U.S. nor any other western nation has yet been willing to take:

Norm’s legal team finally sees the futility of arguing for the counting of absentee ballots obtained via forgery.

Meanwhile, Eric Kleefeld notes that the legal arguments both sides are making don’t match up with their party affiliations. Right is left and left is right.

Best joke about Gregg withdrawal? (There have to be so many.) Send me your entries.

(ed.note: I’m tempted to suggest that Gregg was reviewing his records in preparation for his confirmation hearings and discovered that he’s a conservative Republican and Obama’s a Democrat, etc. and felt compelled to withdraw. But I admit you need a bit more poetry to make the whole thing sing.)

Late Update: Further possible joke fodder: Gregg says he notified the White House of his decision “earlier this week.”

Why not former FCC Chair Reed Hundt for Commerce Secretary? He’s got the chops on all the key Commerce

Department issues: trade, Census, broadband, stimulus. He’s got better politics than anyone else you’re going to get for the job. And he was part of the transition team. Also, not to be overlooked: he’s a Democrat, so he might actually pursue sensible policies.

Late Update: Jon Taplin says it should be Eric Schmidt of Google. But having the head of Google get access to all the Commerce Dept. data and then make a widget out of it. Don’t know about that.

From Bloomberg …

Stanford Group Co., a Houston-based investment firm led by billionaire R. Allen Stanford, is under investigation by U.S. securities regulators over sales of certificates of deposit in its affiliated offshore bank and the consistent, above-average returns those investments pay

.

Gibbs on Gregg:

“We regret that he has had a change of heart.” Gibbs said that Gregg had sought the job, promising to support Obama’s agenda, and that once it became clear that wasn’t possible, “it became necessary for Senator Gregg and the Obama administration to part ways.”

Has anyone else read this book? Many of you must have. Only Yesterday by Frederick L. Allen. The classic first-draft history of the 1920s prosperity up to the 1929 crash, written from the vantage point of 1931.

The Times has a piece in tomorrow’s paper coalescing the growing number of experts who believe that many of the big banks are insolvent and that — whatever you want to call it — the government is going to have to step in and really resolve the crisis, through some process of seizing the failed banks, cleaning them up and selling them back into private hands.

It’s a difficult process to chart. But the public mind seems slowly to be shifting in this direction.

The article quotes Simon Johnson and Adam Posen, both of whom we’ve interviewed in recent days on TPMtv. Click the links to see the interviews.