Hank Paulson: Wrong About Everything, All the Time

by matt at 7:30 am on March 14th, 2008 in Economy, Hank Paulson

Paulson: No Big Bailout Needed - Wall Street Journal (2/19/08):

Following the U.K.’s surprise move to nationalize mortgage lender Northern Rock, will the U.S. need to make similar moves?

“Absolutely not,” U.S. Treasury Secretary Henry Paulson told CNBC, dismissing talk that the Bush administration needs to initiate a widespread bailout program to assist the financial industry and restore investor confidence.

Paulson said that while there is a “great deal of risk aversion” in the markets, sentiment “can change quite quickly.” Paulson told CNBC that members of the Hope Now Alliance have fully come on board to support the government-assisted program to help homeowners who are becoming delinquent on their mortgages, as their interest rates reset at higher levels.

Paulson said the spread of the subprime risk into the markets for municipal bonds and student loans, for instance, is a “liquidity risk” affecting a number of those securities. He said that in a period where the focus is on risk aversion and the price of liquidity goes high, “securities that have liquidity backstops in them are going to trade better.” Paulson stressed that the underlying credit for municipal issuers “is strong… [and] hasn’t deteriorated.”

Referring to the U.S. housing data Tuesday from the National Association of Home Builders that pointed to a slight gain in home builders’ confidence in February, Paulson said he “doesn’t place too much stock in that [data] one way or the other.”

Depends on the definition of “absolutely not?”

The Federal Deposit Insurance Corp. is taking steps to brace for an increase in failed financial institutions as the nation’s housing and credit markets continue to worsen.

The FDIC is looking to bring back 25 retirees from its division of resolutions and receiverships. Many of these agency veterans likely worked for the FDIC during the late 1980s and early 1990s, when more than 1,000 financial institutions failed amid the savings-and-loan crisis.
[...]
“Regulators are bracing for well over 100 bank failures in the next 12 to 24 months, with concentrations in Rust Belt states like Michigan and Ohio, and the states that are suffering severe housing-market problems like California, Florida, and Georgia,” said Jaret Seiberg, Washington policy analyst for financial-services firm Stanford Group.

And just in case you thought the FDIC was just practicing, think again:

Hume Bank, Hume, Missouri, was closed today by the Commissioner of Missouri’s Division of Finance, and the Federal Deposit Insurance Corporation (FDIC) was named receiver. To protect depositors, the FDIC Board of Directors approved the assumption of Hume Bank’s insured deposits by Security Bank, Rich Hill, Missouri.

Paulson will eat these words just like all the ones he ate on the housing market.

UPDATE 8:30am PDT: Wonder what our wise and credible Treasury Secretary will have to say about this:

“Our liquidity position in the last 24 hours had significantly deteriorated. We took this important step to restore confidence in us in the marketplace, strengthen our liquidity and allow us to continue normal operations,” said Bear Stearns Chief Executive Alan Schwartz, in a statement.
[...]
The Fed, through its discount window, will provide non-recourse, back-to-back financing to JPMorgan Chase, the commercial bank said. JPMorgan said it does not believe this transaction exposes its shareholders to any material risk.

JPMorgan Chase also said it is working with Bear Stearns on securing permanent financing or other alternatives for the company.

The U.S. Securities and Exchange Commission said it has been in close contact with the Department of the Treasury, the Federal Reserve and the Federal Reserve Bank of New York during the financing talks.

Comments

  1. Mike petty wrote:

    This is about the previous email about the Halliburton rapes I believe that who ever the writer Sara is owes the Barker family an apology of her smart A.. comment and her horrible support for women how dare you mock a family that has suffered because after your false information and article you ignore the justice for Barker close the blog for comments and put your unprofessional comment of this is not the Tracy Barker fan club or Barker family blog how dare you we only hope that you are never raped Sara and then used by another victim like Jones have used Barker and lied about afadavits and lied to congress and then used by attorneys then tossed aside I hardly think that an upset father and sister stating the truth even if it made your article look rediculous that an upset family is a fan club Sara you are a freakin jerk abd I hope someday you loose your job maybe you arent a women at all after reading how you treat victims that are crying for help check your fact Sara !
    You may want to check your facts on Jamie Jones
    was she a military wife at 19 going to Iraq on assighment???
    http://en.wikipedia.org/wiki/Jamie_Leigh_Jones the answer is NO she married her husband in 2006 and he joined the navy in 2007
    therefor she would not be a young military spouse when she went to Iraq or any dependant of the military until last year 2007
    Which means that Barker is the only one who was a military dependant during the assaults

    Did Kevin Rodgers give Jamie Jones a sworn affidavit in the Jones case, SSG Kevin Rodgers, a Texas National Guard Soldier??

    “During my tour in Basra I encountered many unprofessional acts by the employees of KBR and the U.S. State Department.”

    an affadavit of witness, and has Jamie Jones ever been to Basra Iraq she was in Baghdad for 4 days. Both answers would be NO. http://pushingrope.blogspot.com/2007/12/jamie-leigh-jones-update.html attached is the affadavit which was written for a rape victim for Tracy Barker. Not only does Rodgers not know Jones but they have never been in the same part of the country.

    Did Jamie Jones submit the affadavit of Letty Surman maybe but so did rape victim Tracy Barker see http://www.halliburtonwatch.org under Tracy Barker testimony document Letty Surman affadavit and Documents EEOC termination this affadavit Jones claims. This was actual eyewitness accounts of Tracy Barker. Letty Surman was in Basra Iraq again Jamie was in Baghdad. Please compare Surmans affadavit and Tracy Barker’s determination EEOC word for word of Barkers accounts of assault including the name of the manager who raped her, her office camp etc . All for the exception of Surmans own personal experience and Tracy not named but at the end of the affadavit it has a paragraph rumor of Jones.

    Did Tracy Barker go through the Jamie Leigh Foundation and congressman POE?
    The answer NO in fact Barker was the first to come forward Barker was home several months before Jones went to Baghdad Iraq and called Barker and her Husband 1st seargant. but notice this section of the diary is gone??? http://www.pajamasmedia.com/cgi-bin/mt-search.cgi?IncludeBlogs=4&Template=pajamasmedia&search=jamie+jones
    http://www.thepeoplespeakradio.net/2008/tracy-barker/ Barker goes through congressman Etheridge and is the actual first to come forward
    http://abclocal.go.com/ktrk/story?section=news/local&id=5844234
    Jamie claims that she was denied food/water/ for 24 hrs http://en.wikipedia.org/wiki/Jamie_Leigh_Jones
    but on her same foundation she claims that no one should eat food or water for 24 hours http://www.jamieleighjonesfoundation.com

    So please do your research because there is much much more to this story keep digging the more you dig the more disguisted you will find yourselves
    You must ask yourself why wouldn’t the Jamie Leigh Foundation help Tracy Barker when Barker introduced Jones to her attorneys and they shared the same attorney when the foundation was created??? Jamie Jones is a liar a fraud and a user and there is no way around it the truth will come out it always does

    .

    Posted 16 Mar 2008 at 6:33 pm

  2. sarabeth wrote:

    does anyone have any idea what the fuck this guy’s point is (or his problem)?

    the friends and family of rape victim Tracy Barker are out to viciously attack rape victim Jamie Leigh Jones, because JLJ is somehow stealing TB’s thunder?

    or this is somehow about bragging rights as to who was the first to come forward and complain about Halliburton-assisted or Halliburton-obstructed rapes?

    jesus freaking christ!

    Posted 16 Mar 2008 at 7:49 pm

  3. dennis wrote:

    Sarabeth - I will answer your questions abotu Mike. Yes, many people know what Mike is talking about - what he states is true. And I see his problem (as you put it) is people like you who are ignorant to the facts but use free space to blow off your mouth. It is a shame that such a volume of energy that you appear to possess is misdirected. And even more a shame that you are so immature you should chose to end your last Post in the manner you chose. You are one of the first to indicate that such a perfect man as Jesus Christ had a middle name. You really need to grow up and realize your standing in the adult world. Unless you are the child you appear to be. In that case you have an excuse for your childish rhetoric. Not only can you not realize what Tracy Barker and her family has gone through - you don’t even have a clue. I pray you never even come close to being in that set of shoes. Semper Fi

    Posted 08 Aug 2008 at 1:15 pm

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