Treasury Confirms Paulson Woozy Spell

At the final, critical meeting in negotiations on the $700 billion Wall Street bailout -- the last round of talks began at 10:40 p.m. Saturday and ended around 12:25 a.m. this morning - Treasury Secretary Hank Paulson was so short of breath that lawmakers called the Capitol physician because they were so concerned.

Paulson, 62, a former Dartmouth offensive tackle, told lawmakers he was fine and waved off the doctor, despite working around the clock for several days.

But as Paulson and Sen. Chuck Schumer (D-N.Y.) later walked to the microphones to address the media, they were locked arm in arm. Treasury confirmed moments ago that Schumer was steadying Paulson, helping him walk.

-- Paul Kane

September 28, 2008; 4:20 PM ET  | Category:  business
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Drunk with power?

Posted by: Cynic | September 28, 2008 5:14 PM

It's sad that this legislation is the best Congress can come up with.

More effective and much less costly would be:

1) The Federal Reserve providing liquidity (at rates reflective of the risk) to solvent institutions. That is, after all, their job.

2) Allowing financial institutions a one-time opportunity to value mortgage assets as loans (on the basis of expected proceeds), not on a mark-to-market basis.

3) Enabling the FDIC to purchase equity in "troubled" but solvent banks at a significant discount from the lower of book or market.

Posted by: Ghost | September 28, 2008 5:18 PM

Of course, the guy just won a 700B lotto for his banking buddies on Wall Street!

Posted by: Wall Street Lotto | September 28, 2008 5:23 PM

Maybe Paulson finally realized how HE and his friends have screwed the economy and the American people.

Posted by: JOHN KLINE, TULSA, OK | September 28, 2008 5:24 PM

Who decided the sky would fall Monday if "no deal"?

If they are that clairvoyant how did we get into this mess?

Slow down, do it right. This rush to adjournment is typical of our rotten representatives.

Posted by: ROD | September 28, 2008 5:27 PM

Well, I hope he's doing okay, because he's ONE Bush official who is doing a great job! Get some rest, Paulson!

Posted by: Schmetterlingtoo | September 28, 2008 6:05 PM

Well, I hope he's doing okay, because he's ONE Bush official who is doing a great job! Get some rest, Paulson!

Posted by: Schmetterlingtoo | September 28, 2008 6:05 PM

They were quick to rush this deal so Obama and Pelosi,Reid, Dodd, Franks would slip that 20% of 700 billion for Acorn (voter fraud company) in the deal to donate for their campaigns. I am switching to Mccain..Obama 930 million dollar earmarks in less than 2 years..I don't buy his criminal activities anymore, as I didn't know..he says he won't vote for bill now but will look it over after he is in whitehouse?? It will be too late..3rd time he's waited to make a decision.At least Mccain caught that earmark so high I can't even figure out how much 20% of 700 bil is..Last bill for housing he gave them 500 mil..but Freddie and fannie went belly up and they didn't get it..Who does Obama really care about? I searched the net and found all this out..My eyes have been opened..

Posted by: Debbie | September 28, 2008 6:22 PM

They were quick to rush this deal so Obama and Pelosi,Reid, Dodd, Franks would slip that 20% of 700 billion for Acorn (voter fraud company) in the deal to donate for their campaigns. I am switching to Mccain..Obama 930 million dollar earmarks in less than 2 years..I don't buy his criminal activities anymore, as I didn't know..he says he won't vote for bill now but will look it over after he is in whitehouse?? It will be too late..3rd time he's waited to make a decision.At least Mccain caught that earmark so high I can't even figure out how much 20% of 700 bil is..Last bill for housing he gave them 500 mil..but Freddie and fannie went belly up and they didn't get it..Who does Obama really care about? I searched the net and found all this out..My eyes have been opened..

Posted by: Debbie | September 28, 2008 6:22 PM

maybe the ghost of Aaron Burr is looking for another Treasury official to put down. it's gotta be Burr b/c no living politician has the balls to do what great Amercian leaders like Thomas Jefferson and Andrew Jackson did and abolish the central bank and restrain the global banking cartels.

Posted by: million | September 28, 2008 6:22 PM

They were quick to rush this deal so Obama and Pelosi,Reid, Dodd, Franks would slip that 20% of 700 billion for Acorn (voter fraud company) in the deal to donate for their campaigns. I am switching to Mccain..Obama 930 million dollar earmarks in less than 2 years..I don't buy his criminal activities anymore, as I didn't know..he says he won't vote for bill now but will look it over after he is in whitehouse?? It will be too late..3rd time he's waited to make a decision.At least Mccain caught that earmark so high I can't even figure out how much 20% of 700 bil is..Last bill for housing he gave them 500 mil..but Freddie and fannie went belly up and they didn't get it..Who does Obama really care about? I searched the net and found all this out..My eyes have been opened..

Posted by: Debbie | September 28, 2008 6:22 PM

maybe the ghost of Aaron Burr is looking for another Treasury official to put down. it's gotta be Burr b/c no living politician has the balls to do what great Amercian leaders like Thomas Jefferson and Andrew Jackson did and abolish the central bank and restrain the global banking cartels.

Posted by: million | September 28, 2008 6:22 PM

They were quick to rush this deal so Obama and Pelosi,Reid, Dodd, Franks would slip that 20% of 700 billion for Acorn (voter fraud company) in the deal to donate for their campaigns. I am switching to Mccain..Obama 930 million dollar earmarks in less than 2 years..I don't buy his criminal activities anymore, as I didn't know..he says he won't vote for bill now but will look it over after he is in whitehouse?? It will be too late..3rd time he's waited to make a decision.At least Mccain caught that earmark so high I can't even figure out how much 20% of 700 bil is..Last bill for housing he gave them 500 mil..but Freddie and fannie went belly up and they didn't get it..Who does Obama really care about? I searched the net and found all this out..My eyes have been opened..

Posted by: Debbie | September 28, 2008 6:22 PM

This is not a Financial Rescue Bailout Plan. It is a Sellout Plan for the American Taxpayer.

Posted by: BudinOK | September 28, 2008 6:27 PM

No need to be nasty about Secretary Paulson. Whatever you think about the bailout, he has been running himself ragged trying to make it work. With $600 million in the bank, he could be lolling on a beach somewhere, but instead chose to work himself to the point of exhaustion and, quite possibly, despite all the cynicism, because he honestly believes that this is necessary to save the economy. I second the poster who urges him to get some rest and take better care of himself. After all, it's he and Bernanke who are running the country right now, not the clueless dolt in the White House.

Posted by: lydgate | September 28, 2008 6:29 PM

Can the mods please kick the poster "Debbie" (see above) off the forums - so the idiot realizes that sending your post 4 times is not acceptable.

Posted by: GA | September 28, 2008 6:30 PM

Debbie needs to get a grip. If it was good the first time, there's no need to repeat.

Posted by: cumchu | September 28, 2008 6:31 PM

Take care of yourself first, Mr. Secretary. Let go a bit, for a little while.

Posted by: JMFulton, Jr. | September 28, 2008 6:31 PM

Debbie, you're being annoying. Once was enough.

Posted by: StKev | September 28, 2008 6:35 PM

Thw US public recieves nothing out of this deal. We have all have just been robbed and we are totally bankrupt as country. Vote all the Bums out of office. They are supposed to repesent us not Wall Street AND OTHER NON AMERICAN FIRMS.

Posted by: John | September 28, 2008 6:37 PM

Just who did McCain pick as his campaign advisor for the economy? Phil Gramm, who deregulated the energy industry at the behest of Enron while his wife was an auditor on the board of directors of Enron. Who is McCain's campaign manager? A lobbyist. Go figure. McCain supported deregulating the banking industry that helped expand the previous banking crisis. Doesn't surprise me that he was good friends with Charles Keating. Nope, I will not vote Republican this election with this turd in sheep's clothing running for president. He isn't a turd blossom either.

Posted by: Jay | September 28, 2008 6:41 PM

Again, and again. Like most wingnuts, she can't help herself.

Posted by: Debbie does comments | September 28, 2008 6:42 PM

Debbie - stop repeating yourself!

Posted by: Susie | September 28, 2008 6:43 PM

Go easy on Debbie, guys. She's obviously being paid by the post and hasn't actually researched anything (unless Bush and Paulson switched parties last week). Repeating lies often has worked well enough for the GOP. She's just a feisty entrepreneur, see?

Posted by: Tim B | September 28, 2008 6:46 PM

The only Reason Paulson did this was to save HIS name from going into the history books as the one in control of the treasury when the financial makrets in the US collaped..Hes got friends on Wall Street...He used to work at Goldman Sachs when all of this started...He is saving his own A**, first and foremost...If he was so concerned about the American people to work around the clock(that is his job by the way if necassary) then he would have made sure this never happened in the first place...Here is what I don't understand....HOW does the main guy in control of the United States finances, allow it to fail, get a bailout, and THEN be the very one in control of fixing it...It's like having the engineer from the collaped bridge draw up the plans to build the new one....UNREAL....The markets need some help for sure, but I can't even get my mind around this one.

Posted by: Jason | September 28, 2008 6:50 PM

Hay!!! A Santa's bag with $700+ inside would make anyone walk with a wobble. I need some of that wobble!!!!!!

Posted by: theemailman | September 28, 2008 6:51 PM

Just read the bill just call it the LOAN FOR NOTHING thats what were going to the end

Posted by: Big D | September 28, 2008 6:53 PM

The "Bridge to Nowhere" comes to mind

I'm all for helping things, but there has to be other ideas

Posted by: Jason | September 28, 2008 6:55 PM

Think about it. Where is Paulson going to be come 21 January? He is going to be on Wall Street running one of the bailed out companies. I would be wanting $700B hanging as low fruit also. I know few follow events and are clueless about who warned the entire congress about the pending collapse of Fannie Mae and Freddie Mac, but it was Bush and a Senate Bill S-190 who had McCain as a co-sponsor also tried to put some controls on them. Barney Frank, Cris Dodd and Harry Reid stopped it from ever leaving committee. Now look where we are.

Posted by: Bob H | September 28, 2008 6:57 PM

No, they were quick to seal this deal, with stipulations from the Democrats, because the MBA President and the CEO VP, has made a mess of the economy much in the same way they drowned a city, tortured captives, invaded a country and promulgated a dumb war, not a smart one, abused the privacy rights of citizens, outed a CIA agent, contaminated the Dept of Justice, and the list goes on and on....

Posted by: nana4g | September 28, 2008 7:02 PM

Is anybody really surprised? This stuff has been building up for 8 years. When there's a dead skunk in the middle of the road you would think someone would get a whiff of it.

Posted by: Earl | September 28, 2008 7:04 PM

Welcome to the United Socialist States of America. Under our glorious leader, Chairman Bush we are now going backwards through history and in the process giving up all that our country stands for. Long live comrades Paulson & Bernanke.

Posted by: Lester | September 28, 2008 7:04 PM

Give the man a break. If you can't treat another human being with dignity then you are worthy of non yourself. He is first above all else (money, anger, hatred, ignorance, etc.) a human being.

Get well Sir and thank you for your hard work on behalf of all Americans.

Posted by: raoul | September 28, 2008 7:04 PM

McCain voted for 144 billion in pork, Debbie, in the last six years.

And this is not a bailout its ransom.

It wont fix the problem and they will be back for another 700 billion.

Posted by: Jet | September 28, 2008 7:06 PM

Hey Raoul:

When these guys treat us with dignity, we'll treat them with dignity.

Posted by: lambert strether | September 28, 2008 7:07 PM

I thought the job of the treasurer is to watch and keep track of the country's money, not hand it out like Santa Claus. What right does this dude have to make off with the only money left in the country that's not leveraged?
Biggest boldest train robbery ever! Who said a banker, of all people, should watch over the country's money anyway? The stuuupidest president we've ever had!
It will be incredible if the congressmen and women don't get it and vote for this one too. They didn't get it when they voted for the Iraq invasion either.
Where are the brains of this country? Not in Washington, they're pure and simple greedy robbers.

Posted by: steve | September 28, 2008 7:10 PM

as we sit in our corner, staring out at an infinite expanse of painted floor, perhaps we can all sit and reflect on why we as a nation are here - a lack of work ethic, an addiction to cheap oil and cheap credit, cheap plastic crap purchased from a mercantilist "friendly country", and entitlement mentality that would make ANY of our founding fathers vomit... whatever medicine we take will be exceptionally bitter - bailout and taxes or financial lock up and Depression /Recession... maybe we can learn from this experience ...?

Posted by: rocknahardplace | September 28, 2008 7:13 PM

I've met some VERY brilliant people in my life with no motives for personal power or gain beyond reason..Too bad we can't tap into their abilities at a time like this...As long as Ego is in the equation nothing will be done as it should be.

Posted by: Jason | September 28, 2008 7:14 PM

I hope he is better.

Maybe it occurred to him that he is now a socialist - people and governments he condemned all his life.

Posted by: Roy | September 28, 2008 7:16 PM

By the way, Debbie- are you related to Sarah Palin?? Anyway before you vote for McCain consider that his top economic adviser and campaign co-chair is former Senator Phil Gramm dismantled the Glass-Steagall Act in 1999 after receiving millions of dollars from industry lobbyists. This deregulation opened the door for securitization of toxic mortgages and to the mess we have now. By the way, Debbie, I hear that Paulson is looking for an indentured servant- care to apply?

Posted by: Lester | September 28, 2008 7:19 PM

Is not ironic? The same fundamentalists republicans opposing regulation for 8 years, now are opposing a rescue for retirees, college students and small businesses.

Personally it does not affect me, all my money is in gold, but as a foreigner living in the U.S. my concerns go to the poor people around the world.

Those are going to suffer a lot.

Posted by: Rod | September 28, 2008 7:24 PM

Raoul- if Paulson goes to a front line in Iraq and becomes woozy I'll understand. When he's perpetrating the biggest fraud ever conceived on the American people, aided and abetted by most of our Republican and Democratic elected officials, I'm wondering if he's suddenly getting worried about a criminal trial when the whole thing blows up and the American people demand justice.

Posted by: Lester | September 28, 2008 7:30 PM

I EXPECT criminal inquiries into the destruction of the American Dream. Why did the mortgage companies not work with thousands of people unable to pay inflated interest rates? At least they would still be getting cash flowing into their coffers. But no, they insisted a house sit empty and have the nerve to ask the rest of us for a bailout.
John McCain's lobbyist campaign staff has been brown-nosed and greased palmed by Freddie and Fannie this whole time. Bush's Paulson's guilty of receiving excess bonus payouts himself in his last job with Goldman Sachs. Let's see some heads rolling here. Don't they all support torture? We could use that on some of these folks.

Posted by: cindy | September 28, 2008 7:32 PM

Guys, get a grip, it's only $700 Billion. As McCain's good friend and economic advisor, Phil Gram, would say: WHAT A NATION OF WHINERS WE'VE BECOME!

Posted by: 1+1=3 | September 28, 2008 7:34 PM

I would like to remind Mr. Gramm that this nation of whiners is armed to the teeth...many of the whiners are becoming screamers...stay tuned...

Posted by: Lester | September 28, 2008 7:40 PM

Nice to know that banks will get a huge tax relief in the form of loss carrybacks and carryforwards. How much will this be? Seriously doubt that $700 billion accounts for the tax relief the banks will get from this bailout.

Posted by: Not Happy | September 28, 2008 7:40 PM

Thanks for the hard work, Hank, and feel better.

Posted by: Paul | September 28, 2008 7:46 PM

Poor poor criminal scumbag Paulson...quick, someone hand him a fat sack of American's cash to rest his weary head on...

Jewish Power and America's Money Famine
The International Jew, by Henry Ford

If that is the fact, there is no American banker but will say that the method was wrong; economically wrong, logically wrong, commercially wrong, if not criminally wrong.

Today the Federal Reserve boasts of its own reserve as if that were a sign of national economic health. With the country struggling to live, the Federal Reserve ought to be low, not high. The height which the reserve has reached is a measure of the depth of the country's depression.

If the Federal Reserve would let out a part of that flood of money — a high financial authority suggests that less than 10 percent would do it — it would be like an infusion of blood into the nation's veins.

Kuhn, Loeb & Company, the Speyers and the other Jewish money-lenders have money for Mexico, Norway, Germany, and all sorts of commercial companies being organized to do business overseas, and it is American money. The Warburg Federal Reserve System has been badly misused, badly manipulated, and the country is suffering from it.

Still, the people know not what to do. Money is still a mystery. Banking is still sacrosanct. What would be perfectly apparent if done in ordinary business intercourse with a $5 bill, is exceedingly complicated when the sum is five millions and the parties are (1) country banks, (2) Federal Reserve banks and (3) Wall Street speculative institutions. Yet they are only Tom, Dick and Harry with a $5 bill, after all.

The matter is somewhat affected by the gags that are placed on many men competent to criticize. High officials are more or less tied up, by campaign contributions in which all financial concerns have an interest. Legislative officials are, too many of them, indebted to these same interests. A schedule of the private debts of some of the men who have aspired to the Presidency in the last eight years would be very illuminating — almost as illuminating as a schedule of the names of Jews at whose homes they stayed while on journeys through the country. Men who are thus tied up with the present financial system cannot say what in their minds they know.

It is all illustrated in the testimony of T. Cushing Daniel before a committee of Congress. It shows to what an extent the power of this private corporation called the central bank can reach:

"When going through the Bank of England I presented a letter which I had from Secretary Hay, and the official of the bank was very polite. He took me through the bank and when we got back to the reception room I asked him if he would allow me to put a few leading questions to him. He said he would, and I asked him if he would give me a statement of the Bank of England. 'We do not issue statements.' 'Does not the House of Parliament sometimes call on you for some statement as to the condition of the bank?' 'No, sir; they do not call on us.' . . . . 'How is it that some of these revolutionists, so-called, do not get up in the House of Commons and raise the devil to know something about what is going on down here? That would be the condition in our country.' 'Oh most of them are large borrowers from the bank, and we have no difficulty with them.' (laughter.)"

[THE DEARBORN INDEPENDENT, issue of 16 July 1921]

the more things change, the more they stay the same...


In this New World Order the children of Israel will furnish all the leaders without encountering opposition. The Governments of the different peoples forming the world republic will fall without difficulty into the hands of the Jews. It will then be possible for the Jewish rulers to abolish private property and everywhere to make use of the resources of the state. Thus will the promise of the Talmud be fulfilled, in which is said that when the Messianic time is come, the Jews will have all the property of the whole world in their hands."

— Baruch Levy, Letter to Karl Marx, 'La Revue de Paris', p.574, June 1, 1928

Our race is the Master Race. We are divine gods on this planet. We are as different from the inferior races as they are from insects. In fact, compared to our race, other races are beasts and animals, cattle at best. Other races are considered as human excrement. Our destiny is to rule over the inferior races. Our earthly kingdom will be ruled by our leader with a rod of iron. The masses will lick our feet and serve us as our slaves."

— Menachem Begin - Israeli Prime Minister 1977–1983

Posted by: Shootingsparks | September 28, 2008 7:46 PM

Send them to jail not to the hospital! Arrest te fat cats and make an example out of them. Above all, remove GE Financial from the bailout list. If anyone derves a bailout, it sure is them.

The Bush Administration made the mess and voters want to put McCain in as their replacement? It is not Country First, they really want Country Last!

Posted by: jethromayham | September 28, 2008 7:52 PM


Posted by: JOE SCREWED | September 28, 2008 7:53 PM

Don't blame Paulson because the SEC failed to execute it's mission, because of mark-to-market accounting regulations and because too many in Congress think deregulation is the cat's meow AND pushed Freddie/Fannie into sub-prime mortgages so more people could own their own home.

I was suspicious of Paulson too yet I'm now convinced he actually cares about the economy.

Before you start throwing rocks at Paulson, ask yourself: how many times have you voted for a politician who insists upon telling you what you don't want to hear.

Posted by: foxfire | September 28, 2008 7:56 PM

I think this is inappropriately characterized as a Wall Street bailout at the expense of Main Street. While it is true that if the markets continue to devolve in their current manner many commercial and investment banks will fail, the cost to the American consumer (i.e. Main Street) will be much greater than the relatively small market capitalization of Wall Street investment banks. Politicians have done a poor job of pointing out that functioning capital markets is in the economic interest of anyone who:
Has financed a car purchase
Has financed a home purchase
Has financed their lifestyle with unsecured debt on their credit card
Has a job with any company that finances its operations by issuing commercial paper.
and that is just for starters...

Moreover, the taxpayer is already on the hook for this debacle since the FDIC does not have the funds to cover another major bank failure.

I also think that it is highly likely that the taxpayer will make a windfall on this program if the ideologues in the republican house do not mess this up. Simply put, most of the distressed assets likely to be purchased via the TARP yield 10-12% on a loss adjusted basis. If the Treasury finances these purchases at market Treasury rates of 2-4%, the spread of 600 to 1000 basis points represents a long-term windfall to the US taxpayer while also allowing the market to stabilize. This is before assigning any value to any warrants that might also be attached to TARP participation.

Unfortunately the TARP doesn't address the need to recapitalize the banking system once assets have been sold, but at least the process of raising new capital will be more straight forward once banks can come clean about what they continue to own and where they own it.

Lastly, I find it amazing that no one mentions that this crisis was participated by a substantial number of taxpayers who chose to lie on their mortgage applications about how much the earned, and how much they had in assets, how much their house was worth and whether they intended to live in the house the purchased (mini-Trumps). While Wall Street was duplicitous in turning a blind eye to inadequate underwriting, no one put a gun to these now-delinquent borrowers heads and said you must buy a house rather than continue to rent.

Posted by: PM | September 28, 2008 7:58 PM

Hey shootingsparks, any reputable citations for those unbelievable quotes from Begin (I'm no fan) and Baruch Levy, whoever he is. Go back to your cave, hatemonger.

Posted by: newageblues | September 28, 2008 8:00 PM

Thanks, Mr. Secretary. Try to get some shut-eye.

Posted by: George | September 28, 2008 8:00 PM

Just came back from Central Florida's biggest mall. Packed to the gills with shoppers. What crisis, Mr. Secretary?

Have made three offers to three different banks in the past year for properties they are buried in. Ignored, rejected, and never counter offered. There is plenty of liquidity waiting to jump into the market if only the banks would get out of their own way.

Socializing the incompetants' bad paper makes no sense if there is no forced market maker.

Posted by: N. Leppert | September 28, 2008 8:00 PM

The biggest shakedown in history is about to be comitted. Comitted by the banks, in broad daylight, with the aid of congress and the president.

Posted by: BobMaelstrom | September 28, 2008 8:00 PM

You people are all so stupid. Do you really believe the President has all the power. Take a look at The Senate and Congress.

Posted by: Doris | September 28, 2008 8:07 PM

"Debbie"--sorry to tell you, but the McCain campaign will not pay you for multiple posts when you press the "submit" button more than once. Read the memo from the campaign more carefully before your next post. Thanks.

Posted by: McCCamp#93561 | September 28, 2008 8:10 PM

I have the largest house in my small town, and my house value has dropped dramatically. Now this will affect the value of all houses if we don't do something about this very soon. I spend a lot of money in the local restaurants, but since the value of my house has dropped so much, I am unable to spend money locally and the enconomy is being damaged. I thus want my city to buy my house. Since this is urgent I want the city to take a loan of 5 million dollars and expect every citizen in my city will realize that if this is not approved by Sunday night, then calamity will fall on Monday morning. I thus propose using the city money to buy my house for a value the market has no idea but my close friend will help to determine. In 50 years the city can sell my house back, and if they make a loss, I (or my descendants) promise to pay the citizens of this city. At the same time, if they make a profit then 20% of the profits should go to a slush fund that will be managed by the mayor to dole out largesse to his lackeys.

Now this is very urgent. A guy Paulson who was the builder of my palacial house, and now a state official, will help us decide the purchase price of the house. He has worked all week and is currently not in good health. God Bless Paulson and let us save my city from imminent disaster. If we don't act now, this will affect all the house prices and lead to disaster.

Posted by: Ben | September 28, 2008 8:17 PM

Good job, money needeD for wall street.


Posted by: HEISMAN | September 28, 2008 8:18 PM

An open letter to our legislators

Shame on you

Shame on you for not knowing. Anyone with a small amount of business acumen knew for years that this day was coming. You expect your constituents to accept and forgive you for not knowing where all the excesses would lead.

Shame on you for knowing. It is so hard to believe that you did not know. Were you so far removed or so tainted by all of the money? You asked for our trust and you have betrayed us. You have led us to one of the darkest days in our country’s history.

Shame on you for allowing yourself to be pressured into something that was unthinkable 10 days ago. You were set up and told that our economy would collapse if you did not act immediately. You were told it would be your fault if this calamity occurred and you fell for it.

Shame on me for not being politically motivated. I have never been involved in a candidate’s campaign or made my feelings known. I voted and felt I did my duty as an American. I was wrong. I have changed. I have taken every opportunity since this came to light on Thursday to discuss it with people. I have also decided to do everything I can to see that you are not re-elected. Maybe something positive can come out of this.

Posted by: Bob | September 28, 2008 8:20 PM

Hope Hank Paulson has something more substantial to hang on to than Chuck Schumer!

Posted by: Phil | September 28, 2008 8:20 PM

Watch the pricing of these assets to see how the public will be hosed. Bernanke's testimony on TARP ("Troubled Assets Relief Program") was particularly revealing. He said that the government would purchase securities from the banks at their "held to maturity" price. Banks are keeping their toxic mortgage-related securities in their "held to maturity" portfolios at 90% of par. Under the current regulatory scheme these assets are not marked-to-market. The market price is typically 50% of par. So the banks will get 90% of the book value of these assets and the public, well, who are they anyway?

Posted by: fairtrader4 | September 28, 2008 8:23 PM

Debbie, Obama's been in office since 2004, nearly 4 years. People need to get a grip on what earmarks mean....lots of things are earmarked, like bridge repair and so on.

Posted by: Anonymous | September 28, 2008 8:30 PM

Reading this blog, I am dismayed how inhuman our politics takes us. Whether or not you agree with his politics or actions, the proper human response to Paulson's moment of illness is sympathy and concern for another human being in physical distress, perhaps even a bit of empathy for a public servant who is working hard for us despite apparent risk to his health. Let's be nicer to each other.

Posted by: Kevin Burns | September 28, 2008 8:34 PM

One thing that everyone seems to be neglecting and that makes everything in the global financial markets work.....ratings. No one is pointing the figure at Standard and Poors or Moody's. If any failing that has occurred it is these companies not accurately reflecting the worth of the bonds that have been sold on the markets backed by mortgage securities. If the ratings agencies did not understand what was being presented to them given the complexity then why did they rate them triple A? Or if they did understand, why on the back of an ever rising market did no one see the warning signs? These companies should be investigated as they drive the ratings which drive what risk-averse investors ultimately purchase.

Posted by: Steve | September 28, 2008 8:38 PM

Debbie, How nice that you are "switching to McCain". No doubt you were a strong Obama supporter before you decided to "switch", right?

Posted by: Not Fooled | September 28, 2008 8:42 PM

Why has no one commented on the blatant conflict of interest between Paulson's blind trust which contains $500-$600mm of GS stock, stock options and other GS-related investments and his actions as Secretary of the Treasury? Could anyone have failed to notice that Goldman Sachs now has 3 fewer competitors, and BoA and Citi are sitting on mountains of toxic waste? And if Mitsubishi UFJ's rumored capital infusion of $8 billion into Morgan Stanley falls through, you will see a run in the next 2 weeks on MS that will eliminate one more competitor. MS’ prime brokerage business was already being devastated by hundreds of billions of client withdrawals. Paulson is simply protecting his own GS investments and positioning GS for the post-bailout rally. Let's call this for what it is -- naked self-interest -- and what it is not -- public spiritedness.

Posted by: prometheus | September 28, 2008 8:53 PM

Shucks, why not? The U.S. is so broke that another trillion dollars of taxpayer's debt ain't gonna make no diff'rence. A thought: Let's just officially declare our nation bankrupt and start afresh!

Posted by: Qaviar | September 28, 2008 8:54 PM

If even a few of you Democrats that write to these blogs had even a clue about politics in this country prior to 6 months ago we would all be better off.
The democrats have had control of both houses of congress for the past 2 years. And yet all democrats think every problem facing this country is G. Bush's fault. They could have and should have seen these economic problems coming. G. Bush saw it years ago and tried to get congress to pass legislation to stop it but guess what. The DEMOCRATS wouldn't let it happen. DEMOCRAT C. Dodd is a disgrace as head of the Senate banking committee. This bail out plan has zero chance of actually working. 700 billion dollars worth of bad mortgages that the taxpayers will buy with the assurance of democrats telling us that when the economy gets better we will recoup this money. First off when has anything actually cost what congress tells us it will. I say make it 1.5 trillion and maybe you have a chance. Secondly,who is going to buy all these homes that have been foreclosed on? There is such a glut of home on the market in the US. There are more homes than there are people that can afford a mortgage. So again...who is going to be buying them? The only people that can buy them are wealthy people...the rich get richer! Part of this plan is to keep people in there homes....even when they couldn't afford it when they first got the mortgage. THIS IS WHAT GOT US HERE IN THE FIRST PLACE. Better start learning a foreign language because your next landlord is not going to be speaking english!!!!!

Posted by: PaulG | September 28, 2008 9:03 PM

Initial thoughts – Oceans 14 – the Bush Legacy
No I’m not supportive of the plan. The work on this Plan is the “reasonable” approach that the Administration/Treasury should have first submitted. And as long as earnest work is occurring to give Wall St the pass they are receiving they will keep the market at bay while you make improvements.
So congrats to getting this to a “democratic” document –
$250 to start - $200 would be better
Oversight – for govt - from nothing to a responsible effort
Transparency – look forward to full compliance in reporting
Participation – seems to be a national program
Not Nearly Enough –
Taxpayers seem to have traded the possibility of some return on this gamble for next to NO skin in the game from Wall St – whether intentional (borderline criminal) or stupidity where’s their risk
$300 million in support of a non-government entity as the threshold to impact executive compensation is much too high - $100 million is too high but reasonable as the threshold to participate in the program –
And to continue, only on new contracts is WRONG – NO PAYOUT ON ANY CONTRACT if they use government funds/resources.- suspend active contract terms until and unless troubled assets obtained by TARP have been sold, then in proportion to the risk to the taxpayer
I do not find restraint to those FINANCIAL INSTITUTIONS (37 instances) / APPLICABLE EMPLOYER (7 instances) who benefit from this program to learn from high risk activities /limit or exclude the possibility of a future bailout

Posted by: Sheppo247 | September 28, 2008 9:04 PM


You nailed it. We the People asked for this mess. Especially the ones who took out a trillion dollars in bad debt that they were "entitled" to.

Fantastic. We deserve a socialist president and we're about to get one.

Posted by: Socialists for Obama | September 28, 2008 9:04 PM

Unfortunately, this bailout is needed (Bernanke did a pretty exhaustive analysis in the early 80's of the cure for the Great Depression. Seems that government providing extra capital to the market is the only thing that had any real impact.
A necessary evil in the name of capitalism, I'm afraid...
Since the burden falls on taxpayers, my vote this election is for whichever candidate finally relieves the overburdened middle class and pays the full $700 billion in funds drawn from the crooks who put us into this position in the first place.
McCain's bright idea of making the tax breaks for these criminals permanent is nothing short of criminal itself.

Posted by: adam | September 28, 2008 9:07 PM

the only fact that americans need to know about this entire situation is this

some of these companies that congress is bailing out have given HALF of their revenues to their employees. and 60% of that has been given as bonuses, primarily to the executives. this is a fact, quoted directly from bloomberg:

"Securities firms typically set aside about half of their revenue to pay compensation and benefits. Of that, about 60 percent is paid in bonuses at year end."

this "bailout" is a direct transfer of wealth from all of america, to some of the richest people in the planet

it's the biggest, most obscene golden parachute ever.

oppose it. there are other solutions

Posted by: refused | September 28, 2008 9:10 PM

Blame the Democrats, the party of Wall Street and unregulated capitalism!

Laissez-Faire all the way, Baby!

Posted by: R. Murdoch | September 28, 2008 9:18 PM

Blackmail pure and simple. And if you think there any real difference between McCain and Obama you are simply fooling yourself.
The best thing we can do is vote for a third party - any of them. Anything's better than the two idiot parties who are currently in control.
Jokers to the left of me, fools to the right. Here I am stuck in the middle with you.

Posted by: Todd | September 28, 2008 9:21 PM

PaulG said: "If even a few of you Democrats that write to these blogs had even a clue about politics in this country prior to 6 months ago we would all be better off..."

George Bush has been president for the last 8 years. The crisis that is upon us and its unsavory implications were understood going back to at least 2004 if not earlier. As our so called leader Bush should have alerted us to the problem and taken preemptive action. Just like with 9/11 or the response to Katrina among many other failures, Bush never acts, he only reacts using scare tactics to get what he wants. I'm afraid that the democrats like the republicans have relentlessly granted this administration a carte blanche. As futile as it may turn out to be it's nice to see some resistance from some republicans and democrats to the bailout hoax. Both parties are bankrupt and I would hope that Ron Paul can somehow rise to the occasion.

Posted by: Lester | September 28, 2008 9:22 PM

Paulson had the air sucked of his lungs just a few days before the rest of us get it. Or maybe he had a vision of what his 'next life' may look like.

Be careful for what you wish for, Paulson. May termites eat your hedge funds.

Posted by: Grace Colasurdo | September 28, 2008 9:29 PM

Hey Socialists for Obama,

What do you mean we are "about to get a socialist president" ??? We've had one for the past 8 years. The Big Bailout is Bush's plan crafted by his appointee Paulson. Or hadn't you noticed?

Posted by: Tennessee Valley | September 28, 2008 9:32 PM

Hey Lester in case you haven't heard this problem goes back to the Clinton administration and their instance that Fanny Mae extend mortgages be to low income households that could not afford them

Posted by: PaulG | September 28, 2008 9:39 PM

We have pawned off our debts to our children and our children's children. We continue to believe that things will get better tomorrow if we simply put off today's problems. Shame on all of us for feeling so self-righteous, deserving and addicted to instant gràtification. I'm even more embarrassed to admit I'm American now when I travel overseas. By the way, not ALL of us were stupid, greedy and living beyond our meanS but I'll happily chip in for my neighbors, friends and co-workers stupidity. My 3-persons family's $7000 check is in the mail treasury, we've got your back everyone!!

Posted by: blindandgreedy | September 28, 2008 9:39 PM


Is Lehman Bros. going to be saved by this?

Posted by: Jason | September 28, 2008 9:44 PM

It's Clinton's Fault!
It's Clinton's Fault!

or was it Carter?


FDR maybe?

Posted by: Mission Accomplished | September 28, 2008 9:46 PM

WE need $85 Billion now!!

We have to go get these weapons of mass destruction NOW!! This week! If we don't go get these weapons of mass destruction right now we will be attacked and unsafe...

fool me once......

Posted by: Bill | September 28, 2008 9:50 PM

This 700 BILLION "BAILOUT" just SAVED Paulson's "100 million dollar piece"....

looks like Paulson will have Turkey on the Thanksgiving Platter.....and not bologna and government cheese:)

Posted by: Sean | September 28, 2008 9:55 PM

Hello PaulG- I agree that many of the Clinton policies have contributed to the current mess (I don't recall him interfering with Phil Gramm's deregulation efforts). My point is that, except for rare occasions, none of the politicians or their parties, going back as far as you like, have ignored doing what is politically expedient usually at the cost of the country and its citizens. Unfortunately there have been a successive number of major policy failures from past administrations culminating in the overwhelming incompetence of the present one. The bailout is the tip of the iceberg...

Posted by: Lester | September 28, 2008 9:59 PM

Our greatest glory consist not in never failing but in rising everytime we fall..

Posted by: i''mnotdebbie | September 28, 2008 10:01 PM

Lester....You hit that on the head indeed...this is just the tip of the iceberg. Unfortunately for me I am about 1.5 years away from retiring....hopefully, maybe, I think:-)

Posted by: PaulG | September 28, 2008 10:02 PM

Guess it's a done deal...Watch your bank fees skyrocket in 5 years to cover their requirement of return.

Posted by: Bill | September 28, 2008 10:13 PM

How about increasing FDIC coverage to $2million for depositors so that we don't have to worry about a run on the banks!!!

Posted by: EAA | September 28, 2008 10:18 PM

This is Government by Terror.
First we had to hurry to invade Iraq before they nuked us with those Weapons of Mass Destruction that they absolutely-definitely-positively had. Si it was Whoppers of Mass Distortion instead, costing taxpayers literally Trillions. Now the Iraqis are building a giant air-conditioned Ferris Wheel in Baghdad while we can't afford improvements to infrastructure, health care or education. But that's just the beginning. Now we have to pony up $700Bn or face Armageddon. We will all be cowering in tent cities as the Chinese roll their tanks in to foreclose on the country, the worst catastrophy since the Great Depression!!! Brother, can you spare a few hundred Billion?
Government by Terror.

Posted by: TJM | September 28, 2008 10:29 PM

Why should we believe George Bush or Hank Paulson now? If either of these two public servants were real experts they would have acted months if not years before this problem reached critical mass. And why should we believe this President's assertions that the sky will fall should Congress not act immediately? Isn't this the same President who willfully misled the country about Iraq? Isn't this the same President and his agents who negligently bungled the post-Katrina response to our fellow Americans living on the Gulf Coast? Isn't this the same President, cocksure and certain, who claimed the "fundamentals of our economy are strong"? When will our representatives learn? When will they grow a spine and say no to another inane, implausible and extravagant "plan" from the most incompetent and unethical President in U. S. History?

Posted by: Marc | September 28, 2008 10:36 PM

Who cares if Paulson is woozy? There is a tight correlation between his reaction to the problem as it unfolded and the impact on Goldman Sachs. As long as Goldman looked secure, Paulson didn't find a bailout necessary. As soon as Goldman started to go down, he needed 700B from us, and wanted a blank check. Newt Gingrich was right to say, this morning, that Paulson should resign. As the chairman of Goldman till 2006, he was part of creating the problem, and profited handsomely from it. Then he asked for a 700B blank-check bailout. We don't need him.

Posted by: ailey | September 28, 2008 10:56 PM

Biggest insider trading prop up case of all time. Let Lehman fail, help ML (JOHN THAIN GS) help AIG large counter party to GS. This whole mess smacks of insider dealings.
The dollar will eventually crater.
More of the great dumming down of America.
Junkj in junk out.
How can China be our creditor after only 30 years post Mao and we 200 plus years?
All of these insiderts should get a $1./year lie Lee I at Chrysler years ago.

Posted by: Bodo | September 28, 2008 10:56 PM


Posted by: SCHMETTERLING | September 28, 2008 11:11 PM


That post really just makes you look a decent guy....not Paulson


Posted by: Bill | September 28, 2008 11:15 PM

I believe is was Lenin who said capitalists can weather any crisis as long as they make the workers pay.

Remind you of anything?

Posted by: American Citizen | September 28, 2008 11:28 PM

The critics of this emergency package are the same imbeciles that took out mortgages they could not afford to carry, and overpaid big time for shacks.

I spit on them

Posted by: Mr Hyde | September 28, 2008 11:30 PM

This is the final nail in the coffin for reaganomics. Trickle doesn't work. THis is merely the end game.

I am opposed to any bail out for failed businesses. I have a business. If we don't work hard and make the right decisions we would be out of business. The fact that they are getting special treatment is crap.

This is also the end game of the fact that this country elected W. We knew he was a bozo but he got a 2nd term. What an error. This meltdown is directly related to the bush administration being completely incompetent. Yes, we elected him. So the pain on main street could have been by electing an INTELLIGENT leader.

So, we got what the majority asked for. The bail out is wrong on a thousand levels.

Posted by: David | September 28, 2008 11:32 PM

"The critics of this emergency package are the same imbeciles that took out mortgages they could not afford to carry, and overpaid big time for shacks.

I spit on them"


I've done neither and am completely against it... I WILL NOT vote for any congressional leader who was for this in the next election

Posted by: Bill | September 28, 2008 11:32 PM

Im sure i wouldn't be welcome at any of the watering holes where paulson sips his brandy,yet now to be told to bow to the mans demands in order to save his stock options,well that makes me more then a little woozy,it makes me want to knock him out.And if chuck schumer doesnt look sleazy,then i dont no what sleazy is.Im sure their are alot of guys on C block wishing they had the clout to pull off the crime these clowns are commiteing.Heck for 7 billion they may even play dead,never mind woozy.

Posted by: geronimo | September 28, 2008 11:35 PM

The CEO of WaMu--biggest savings bank in the country that went bankrupt last Friday--is getting $15 million for 3 weeks on the job. He was just hired 3 weeks ago to save them from bankruptcy. Now he gets to loot the bank on his way out the door.

Posted by: Pitchfork Gramps | September 28, 2008 11:44 PM

I could deal with staying in a tent city if there was enough room for my 52" plasma TV, a Starbucks nearby and a parking space for my Yukon Dinali.

Posted by: Willing to Sacrifice | September 29, 2008 12:06 AM


The ridiculous argument that congress is making boils down to one basic premise: that these 2 ordinary guys (one who never lead anything other than a classroom and the other who made his fortune gambling on Wall Street) can all of a sudden predict with certainty the economic future of this country. If these 2 guys were so smart why weren’t the ringing the alarm bill months ago?

The fortune tellers however do deserve credit for accurately predicting that top congressional leaders were so beholden to Wall Street for years of financial support that they would work weekends in backrooms to get the big fix in. However it still begs the question that: if this really is a national economic crisis then why are our legislatures negotiating the details of the solution in secret behind closed doors instead of on the floor of the houses.

You would think that given that the cost of this bailout is almost $10,000 per household that congress would hold lots of hearings with expert economists and scholars far and wide to seek some kind of consensus or assurance that this $10,000 for tax bill every American household would solve the problem.

According to these two fortune tellers (the gambler and the professor) the bailout purpose is to buy stuff no capitalist will touch in an effort to free up money. Well from my experience there nothing like a bargain to get people to buy and put money to work. Why don’t we pass legislation that forces the banks to sell either write down or sell the assets. If the bank fails we let the FDIC step in and protect the taxpayer. After all it is their job.

These two fortune tellers (the gambler and the professor) also said it is import that we free up money so that the banks can lend to businesses for investments and to consumers for purchases using credit cards and other loans. They say that absent this bailout companies would have no money to expand or, in some cases, to make payroll. Seems like if companies can’t meet payroll without a loan they are already too far gone. Credit tightening for consumers sound reasonable given that the problem is a result of consumer credit being too freely available. Experts agree that regardless of what happens, good people with good credit who are not overleveraged will still be able to get a loan

The gambler and the professor bet correctly that the upcoming recess and Jewish holiday would allow them to rush the bailout through. The Congressional leadership did their part by telling their party members that they can sidestep repercussions of voting for the bailout with the same ease as they did for the voting for going to war. They think that if you claim that everyone is suffering and that they believed that they acted selfishly to try and prevent a the deep and prolonged recession that it will give them the political cover they need.

The American people will not be so easily fooled.
Despite all the hype and hysteria from the fortune tellers (the gambler and the professor) congress might come to its senses. It might realize that even if the markets do decline that it is not going to be the end of the world despite what those two fortune tellers think. Because if the bailout is the right answer it will be able to rescue and resuscitate the markets from the worst case scenario whether it be 3 days, or 3 weeks or 3 months from now.

It is time for the American People to wake up and take this country back from the special interests. Tell everyone you know that we all need to send a message to Washington that the voice of the American people stills counts by voting out each and every incumbent who votes for the bailout without any promise or open debate about its success.

Posted by: Radioceleb99 | September 29, 2008 12:50 AM

Our concerns are that the Bail Out bill will not go far enough to limits CEO’s and upper management salaries. In fact, CEO’s and upper management must not get any Severance Packages for wrong doing. They must be fired, without Severance Packages just like companies would do when middle class employees go against companies rules. We must have strong economical deterrents just like we have strong national defense deterrents. Just slapping these jokers wrist will not stop them from future wrong doings. Knowing the mind set of congress and the administration, and probably criminal activity, we are certain that the Executive Compensation part of the bill will be extremely weak. Plus, we must not forget your campaigning break. When it comes from Corporate America and Lawmakers, laws can be broken without penalties.

Posted by: Bob Vargas | September 29, 2008 1:57 AM

Leaders Nancy Pelosi and Harry Reid had the power as leaders to do something about America’s national financial crisis over their last couple of years in Congress. Bush is responsible for signing bills into law, but Pelosi and Reid have the responsibility to set the country's legislative agenda and provide leadership to pass financial institution laws and banking regulations, but they both ignored the looming loan crisis until the very last minute. They failed our nation big time and should resign.

The senators and House leaders on the senate and house banking committee's should also resign because they failed to take action, when they were fully aware the country would eventually face a liquidity and banking crisis. They failed the nation along with the rest of the senate and house that relies on their banking committee to hold hearings, write banking laws and provide legislative oversight of our banking institutions.

The leadership in the White House - Bush, Senate - Harry Reid, House - Nancy Pelosi, and both Democrats and Republican's on the banking committees have failed to provide leadership and foresight to protect and regulate our nations financial system and institutions. Over the years Greenspan warned them that the increasing national debt was unsustainable that could lead to a national financial crisis if other countries lose confidence in our financial system and stop buying our national debt.

Congress just continues to overspend the nations money, give political favors to financial company's that give them political contributions, and add billions of dollars of earmarks for unneeded pork projects and possible fraud.

Did Congress and Bush really think they could run up the national debt forever and the rest of the world would continue to finance all of the nation's debt with a falling dollar? What about worthless American housing loan securities that they bought that are now becoming worthless? No! Now the world is slowly stopping to buy our debt and our nation may go bankrupt. Our only solution is to print more money to make up the difference, only leading to a lower dollar. This in turn may require the fed to increase interest rates to a premium to eventually attract more foreigners to buy more of our risky national debt due to a declining dollar at the expense of our own economy.

Bush, Pelosi and Reid had the legislative and executive power to prevent this nation’s financial crisis but they simply ignored it until the nations financial institutions practically crashed.

Now all American's will suffer, but they will now just continue to blame each other or the other political party, when they were all to blame.

Bush, Reid and Pelosi should all leave office because they over time allowed the nation’s financial crisis to evolve and continue to get worse until it practically crashed, all on their watch as national leaders. There is a reason that both Bush and Congress have low national approval ratings, it is because they as leaders have failed to make America better over the years. When either Obama or McCain is elected, both Reid and Pelosi should step down so congress can start fresh with new House and Senate leadership, so congress once again can gain the confidence and approval of the American public.

The "time of change is now" and we need national leaders to put the "country first" over party politics’ and corporate political donations influences that have led the country to the biggest financial crisis since the great depression.

Right now Obama and McCain should both be very involved with what congress is doing with the bailout because it is going to greatly impact their potential presidency in a few months and one of them will need to fix this country’s massive financial mess as president.

Posted by: abel | September 29, 2008 2:07 AM

This was all a long time coming. Reagan started with the deregulating. Bush 41 was known to be a laissez-faire politician. We got a slight break from this with Clinton but he was a centrist despite how conservatives try to paint him. Then with Bush 43 we get another laissez-faire politician. This must be a Bush family belief as it is believed that George Bush's grandfather was also involved in the attempted coup in 1933 of corporations against the Roosevelt administration. In 1933 the Glass-Steagall Act was passed to control banking speculation. Then in 1999 the Gramm-Leach-Bliley Act was passed to repeal the Glass-Steagall Act. This is when the mess started and Phil Gramm is McCains ecinomic advisor. Seems McCain should get a new advisor. Construction is usually the first hit in an economic downturn but construction is the one thing that has held up the economy for the last 8 years. This was peculiar and anyone that knows anything about the economy should have known this to be a red flag that something was not quite right. But some people were happy with this fairy tale but now it's come back to haunt us in the sum of 700 billion. No one wanted to pay attention to the signs because if you believe in laissez-faire economics like the Bush Family and their buddies you just knew the market would right itself. Well it didn't and now we all pay.

Posted by: Earl | September 29, 2008 2:20 AM

Paulson is a Christian Scientist, he doesn't believe in medical care.

Posted by: Heather | September 29, 2008 6:03 AM

Paulson is a Christian Scientist, he doesn't believe in medical care.

Posted by: Heather | September 29, 2008 6:03 AM

I saw him on TV last night and thought he looks like he's on the verge of a hear attack. I hope he will be checked out and soon. We don't need a medical emergency on top of this financial crises.

Posted by: boulie | September 29, 2008 8:26 AM

My prayers are with Mr. Paulson. He's in an extraordinarily unpleasant situation, and he's working extremely hard for all of us -- even if many of us don't seem to appreciate it. Best wishes to the Secretary.

Posted by: davestickler | September 29, 2008 9:47 PM

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