Henry 'Hank' Paulson -
- The Most Powerful Man in America -
Hank Paulson, U.S. Treasury Secretary
The housing bubble was created by greed, foolishness, and stupidity, yet here comes the government attempting to keep the bubble from deflating using more stupidity.
Paulson's take on Intervention
Here is the Trillion dollar question:
"Where will the money come from?"
Hank Paulson's latest plan to protect homebuyers from their own mistakes is simple: Lenders extend those teaser rates for a few years. It's a win-win, right? What's the harm, especially when there's no bill to pay? You just reset those interest rates to low levels, and everything will be fine, right?
I feel like throwing up here. . .
By rescuing greedy and naive borrowers from their mistakes, our government encourages others to take big, stupid, bankruptcy-inducing risks, secure in the knowledge that the government will bail them out when times get rough. That means trillions of dollars in capital will be ill-invested yet again, something that's much less likely to happen when speculators are MADE to suffer the consequences of their behavior.