Paulson Sounds Way Too Confident

“By proactively addressing the problems we saw coming and being pragmatic enough to change strategy in the face of changed facts and despite the inevitable criticism — we prevented a far worse financial crisis.”

What Hank Paulson calls pragmatism, I call making it up as he’s going along. After receiving $700 million for the “Troubled Assets” Relief Program, Paulson decided not to buy any troubled assets. After initially wanting to be above the law, he eventually learned the hard way that no one, not even Bush Administration Cabinet Secretaries, can be. After initially requesting $700 billion, Paulson decided to spend half of it. After allowing Lehman Brothers to fail (a Goldman Sachs competitor), he decided to bail out AIG (whose survival helps the bottom line of Goldman).

The cronyism and overconfidence of Hank Paulson has done nothing to relieve the credit crisis as stocks continue their plunge below 8,000. It is unknowable what would have happened had we rode this thing out a couple months and let the incoming administration handle it (a more appropriate course of action). Hank Paulson, who decried government intervention his entire career, should never have been put in charge of this bailout. I’m sure he will be back in an executive suite where he belongs in no time. He is just another emperor without any clothes (as we have learned that most of these alleged Wall Street wizzes are nothing more than lucky betters whose collective luck has all run out).