Shorter Henry Paulson
US Shifts Bailout Focus to Consumers:
The Treasury Department on Wednesday officially abandoned the original strategy behind its $700 billion effort to rescue the financial system, as administration officials acknowledged that banks and financial institutions were as unwilling as ever to lend to consumers…
Despite the mind-boggling amount of money that Congress has authorized the Treasury to spend — $350 billion immediately, and another $350 billion that Congress would approve under a fast-track procedure — Mr. Paulson is running short of money and time…
Mr. Paulson conceded that he had scrapped the plan he originally sold to Congress in September, which was to have the Treasury Department buy hundreds of billions of dollars worth of illiquid mortgage-backed securities in order to free up banks to resume normal lending….
As recently as a few days ago, Treasury officials insisted that they still intended to buy up the troubled assets. But by late October, it had become clear that Plan A had become little more than a sideshow.
“Illiquid assets looked like the way to go,” Mr. Paulson told reporters at a news conference on Wednesday. But as economic and financial conditions declined so rapidly, he said, that he had to change gears. “I will never apologize for changing the approach and the strategy when the facts change,” he said.
Shorter Henry Paulson: “I am totally making this shit up as I go along.”
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November 13th, 2008 at 9:39 am
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