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Paulson has an OpEd at NY Times:

WE are going through a financial crisis more severe and unpredictable than any in our lifetimes.  [We] faced [big failures] in succession, as our financial system seized up and severely damaged the economy.

By September, the government faced a systemwide crisis. After months of making the most of the authority we already had, we asked Congress for a comprehensive rescue package so we could stabilize our financial system and minimize further damage to our economy.

By the time the legislation had passed on Oct. 3, the global market crisis was so broad and so severe that we needed to move quickly and take powerful steps to stabilize our financial system and to get credit flowing again. Our initial intent was to strengthen the banking system by purchasing illiquid mortgages and mortgage-related securities. But the severity and magnitude of the situation had worsened to such an extent that an asset purchase program would not be effective enough, quickly enough. Therefore, exercising the authority granted by Congress in this legislation, we quickly deployed a $250 billion capital injection program, fully anticipating we would follow that with a program for buying troubled assets.

[snip]

A troubled-asset purchase program, to be effective, would require a huge commitment of money. In mid-September, before economic conditions worsened, $700 billion in troubled asset purchases would have had a significant impact. But half of that sum, in a worse economy, simply isn't enough firepower.

A huge commitment of money? Whatever you ask, Paul.

There is no playbook for responding to turmoil we have never faced... [If] we have learned anything throughout this year, we have learned that this financial crisis is unpredictable and difficult to counteract.

I thought secretaries of treasury are supposed to look less clueless.

A list of top 11 Paulson's blunders is here.

by das monde on Tue Nov 18th, 2008 at 09:24:26 PM EST

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