u2018It's Time To Enshrine Hank Paulson as National Hero' WTF?

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By Evan

Hank Paulson
is a national hero.

I said it
last October and I’m sticking by it. And now, there’s
actual evidence to back me up. The TARP bailout worked. The Wall
Street crisis is over.

via Mean
Street: It’s Time to Enshrine Hank Paulson as National Hero
– Deal Journal – WSJ

So here’s
the letter I wrote to the Wall Street Journal after reading
Evan Newmark’s paean to Hank Paulson last week:

Dear WSJ,

Just out
of curiosity – did Evan Newmark ever work for Goldman, Sachs?
And if the answer to the question is yes, don’t you think
that might have been a good fact to disclose before he fellated
Hank Paulson in his “Mean Street” column?

Matt Taibbi

Can you imagine
what a craven, bumlicking ass-goblin you’d have to be to get
a job working for the Wall Street Journal, not mention up
front that you used to be a Goldman, Sachs managing director, and
then write a lengthy article calling your former boss a “national
hero” – in the middle of a sweeping financial crisis,
one in which half the world is in a panic and the unemployment rate
just hit a 25-year high? Behavior like this, you usually don’t
see it outside prison trusties who spend their evenings shining
the guards’ boots. I can’t even think of a political press
secretary who would sink that low. Hank Paulson, a hero? Are you
fucking kidding us?

Exactly what
part of Paulson’s record is heroic, Evan? The part where he
called up SEC director William Donaldson in 2004 and quietly arranged
to get the state to drop capital requirements for the country’s
top five investment banks? You remember that business, right, Evan?
Your hero Paulson met with Donaldson and got the rules changed so
that Goldman and four other banks no longer had to abide by the
old restrictions that forced banks to actually have a dollar or
two on hand for every ten or so they lent out. After that, it was
party time! Bear Stearns in just a few years had a debt-to-equity
ration of 33-1! Lehman’s went to 32-1. By an amazing coincidence,
both of these companies exploded
just a few years after that meeting, and all of the rest of us,
Evan, ended up footing the bill, thanks to a state-sponsored rescue
of Bear and a much larger massive bailout of Wall Street in general,
necessitated in large part by the damage caused by the chaos surrounding
Lehman’s collapse.

Meanwhile your
own Goldman, Sachs ended up with a 22:1 debt-to-equity ratio a few
years following that meeting, a number that would have been much
higher if one didn’t count the hedges Goldman bought through
a company called AIG. Thanks in large part to Paulson’s leadership
in his last years as head of Goldman, the company was so massively
over-leveraged that it would have gone under if AIG – which
owed Goldman billions when it went into its death spiral last September
– had been allowed to collapse. But thanks to Hank Paulson,
who heroically stepped in and gave AIG $80 billion the same weekend
he allowed one of Goldman’s last key competitors, Lehman, to
collapse, Goldman didn’t have to go without that money; $13
billion of the AIG bailout went straight to Goldman. So I guess
we have Paulson to thank for the fact that he used about $13 billion
of our taxpayer money to essentially bail out his own fuckups.
I mean, that’s heroism if I’ve ever seen it. Audie Murphy
has nothing on that. Sit your asses back down, Harriet Tubman, Thomas
More, Gandhi and Jesus Christ. Hank Paulson is in the house!

the rest of the article

9, 2009

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