Treasury Secretary Henry Paulson said Tuesday that he did not expect any more major financial institutions to fail during the current credit crisis.
Paulson also said he had no plans to ask Congress to make the second half of the $700 billion financial rescue fund available before the administration of President George W. Bush leaves office on Jan. 20.
I had to double-check the dateline on this piece, seems like I'd heard it all somewhere before. Oh yeah, it was in the New York Times, November 17, 2008, where Paulson said:
As policymakers face the difficult challenges ahead, they will begin with two considerable advantages: a significantly more stable banking system, one where the failure of a major bank is no longer a pressing concern; and the resources, authority and potential programs available to deal with the future capital and liquidity needs of credit providers.
I suppose if you want to be extraordinarily technical, he was correct. Citigroup didn't "fail", they were bailed out on November 23rd, less than a week after the Paulson said that "the failure of a major bank is no longer a pressing concern." I mocked him for that statement on 11/18, where I said:
"The failure of a bank is no longer a pressing concern"??? So what will he say once Citigroup goes belly up? Oh, that won't be a "failure", because the government will either dump a bunch of money into them, or help them become acquired.I like being right, but sometimes I just wish I were wrong.