Paulson Calls for Tough Rules
The senators have finished beating up on everyone and Treasury Secretary Hank Paulson began his forceful testimony.
"The events of today began many years ago with banks and lenders using bad lending practices and borrowers taking out mortgages they couldn't afford," Paulson said.
He has gone off on a couple of what he's called "ad hoc responses," speaking with emotion about the events of the past weeks.
"I share your frustrations, I feel your frustrations about the practices" that led to the current crisis "and they also upset me," he said.
Paulson said the economy was much closer to the precipice than many may have realized, and referred to his "bazooka in the pocket" comment from April, which referenced the massive firepower available at Treasury to bail out Fannie Mae and Freddie Mac, which the government eventually deployed.
"You all can be darn glad you gave us that bazooka because we needed it," Paulson said.
He concluded his testimony by calling for strong congressional oversight.
"I believe we need oversight, we need protection, we need transparency," he said.
Wall Street is watching this hearing closely.
In late-morning trading, the markets were still in positive territory: the Dow was trading up about 74 points, and the Nasdaq and the S&P were up 17 and 5 respectively.
-- Frank Ahrens
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