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Paulson has done a horrible job, but what else should we expect from the out-the-door-but-not-fast-enough Bush-Cheney regime? In addition to moving too slowly and without any coherent plan, Paulson's approach seems to side-step the underlying problem of all those "toxic" mortgages--the subprime ones. Many people were able to pay them until the rates shot up, suggesting that if these loans were renegotiated, it would significantly cut down on the daily deluge of defaults, which put new pressures on the banks necessitating more and more money to plug their expanding financial holes. Sheila Bair seems the only person on top of things--a good pick for Treasury Sec.?

Peterson/18

thanks for the laugh!

Thomas Friedman's Op Ed piece on GM bailout:
http://www.nytimes.com/2008/11/12/opinion/12friedman.html?em
For the sake of the health of the economy, it seems we will have to bail out GM. But it is not just GM's fault. Members of Congress who have supported energy policies that kept alive the gas-guzzling car industry are also to blame. Yet another shame of the nation.

Mr. Lehrer:
The use of the term “bail out” for every type of real or contemplated government/private transaction is inaccurate and, frankly, lazy journalism. In recent months programs such as direct loans, loan guarantees, asset purchases and equity infusions have all played a part in this process – and each of these are different financial instruments. Accuracy and more non-judgmental precision in terminology will help to put the validity of these plans into perspective.
Or should we refer to the annual pledge drive as a WNYC “bail out”?

I think the question of Paulson managing the $700 billion is not the important one. Rather, why the deafening silence from the President? (OK, we know why...this President doesn't really do complexity; he has the heart and mind of a cheerleader, etc.)

I hope when Obama takes office that he will give a series of talks in order to explain the situation to the American people. We need a better understanding than "what happens on Wall Street affects Main Street." That's what I really think is missing here, and that's why Paulson appears to be alone on stage and winging it. He (or his successor) needs an Executive behind him fitting his moves into a broader picture. The Treasury Secretary needs to be tactical; the President should supply the strategic picture. Since we're getting nothing from our current President, it appears that the entire response is tactical. Reminds me of Iraq, actually.

It is clear that Paulson et al are clueless. They are throwing money here, throwing money there and there is no clear policy. Furthermore, the insurance business is about managing risk (a.k.a. Gambling) and AIG didn't manage it. Throwing so much money at them is just wrong. A better solution might be guaranteeing the annuities and taking over a majority of the insurance guaranties but just letting the company fail. A definite better way to structure a bailout would be to have a massive public works program which would cost a fraction of the bailout involving throwing money at big gamblers.

Regardless whether my suggestion makes sense or is just too cold blooded, a WSJ editorial on Oct 31 points out that investors cannot invest intelligently while the govt is constantly changing the rules. Essentially, the financial markets cannot stabilize until there is a clear policy. I bet we're going to bounce around until late January at the earliest.

The auto industry needs to reorganized not bailed out! They need to become more competitive with Japanese and German auto companies. Let them go into Chapter 11 and then be reorganized! This is what Chapter 11 Bankruptcy Laws are supposed to help companies do.

Paulson is giving money to business, not the taxpayers. Can a lame duck session of Congress stop him from doing this? What do the lame ducks have to lose? The money will be gone if we wait until January 20. The Republicans are looting the public treasury again -- as they looted the trillion dollar surplus with their 2002 tax cuts.

Can't they be stopped? Can the Obama database of millions of e-mails and cell phone numbers to organize a public campaign to force Congress to amend the bail-out bill?

John,

The irony is brutal isn't it?

Paulson also lobbied to increase the amount the investment banks could leverage themselves from 12 to 1 to 40 to 1. The change was made in 2004.

We are not shallowing any of this. He is rewarding the very companies that got us into this disastrous economy.

1 in 10 American jobs are linked to the auto industry.

It's unfortunate but they have to be bailed out.

We're in the realm of painful choices and incredibly painful choices. Get used to it.

"Breaking News 10:51 AM ET: Paulson Says Bailout Funds May Be Used for Non-Bank Companies"

My husband believes that all these conversations are moot, because Bush will give the whole $700 billion to business before leaving office.

I hope that one day this bailout will be seen as the tilting point, rarely has it been so obvious how capitalism dumps debt on taxpayers while privatizing gains during expansions.

WHy isn't anyone speaking about Paulson's background? He was the chairman of GOldman Sachs, and was personally involved in designing and profiting from these synthetic instruments. Now he's bailing out his friends and touting "traditional lending". What happened to conflicts of interest in this country?

"I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around the banks will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered."

Thomas Jefferson 1802

How would we know? There's no oversight on this money at all.

Not only should Obama overhaul the mass-transit system, but he should restructure and retool the US auto industry so that they produce extremely fuel efficient cars.

Both should be on the agenda.

Paulson is a criminal and corrupt.

AMEX getting bailout money????

Paulson should be sent packing.

He's just giving money to his buddies.

Lehman didn't get money from Paulson because he didn't like them.

I am so outraged by Henry Paulsen's management of the bailout money and rewarding the fat cats that run the big banks and insurance companies into the ground. We can't get these thieves out of office fast enough......... I am reallly outraged!

Paulson is doing an amazing job.

i supported Obama, but i do not approve of bailing out the auto industry. Instead we should expand and over-haul the mass transport system through out the country.