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 A CLOSE CALL September 2, 2010
Doppelganger (United Kingdom)
Ross Sorkin's book 'Too Big To Fail' was the supreme journalistic account of the Bush Administrations fervid attempts to stave off a collapse of the US economy which would have had disastrous consequences for the Global economy. Financial mayhem, of a severity perhaps not encountered before would have ensued. Depression level unemployment, virtual lack of confidence in all financial institutions, runs on national currencies, and a substantial rise in those falling under the poverty line. All of these factors would have contributed to general discontent and even perhaps civil unrest. It would be difficult to provide a better chronicled narrative of these events than Sorkin's book.
However, whereas Sorkin is on the outside looking in, Hank Paulson was on the inside, at the very epicentre of the Government's frantic efforts to find solutions for a seemingly impossible and fast moving series of catastrophic losses in almost every major financial institution and many Blue Chip corporations. Mr Paulson is able to provide a 'fly on the wall' account of not only the fiscal machinations but also an insight into the feverish bi-party negotiations on Capitol Hill for new legislation to facilitate his rescue plans. In fact the two books compliment each other and together provide an excellent rounded account of one of the most critical moments we are likely never to see again - it is hoped.
Along with Ben Bernanke, Chairman of the Federal Reserve, Tim Geithner, President Reserve Bank of New York, Sheila Blair, Chairman of the FDIC and their departmental teams, Hank Paulson worked literally day and night, 7 days a week,for 6 months in 2008 to avert the threatening financial armageddon. And succeed they did but not without quite a few hiccups, confrontations, arguments and near meltdowns. That they succeeded was a tribute to those involved, which should be universally lauded and also an endorsement of the US characteristic that guarantees bi-partisanship in the face of trouble. God Bless America.
This book also details the very important role played by President Bush in recognising and understanding the severity of this very complex set of economic woes, and despite the correctional remedies being contrary to his political beliefs and policies, nevertheless gave his full support and authority to bringing about the urgently required solutions.
Through his writings Hank Paulson comes over as an likeable person, good family man, outstanding Banker, inspirational leader, and exemplary Servant of his country. Without his dogged resolve and gritty determination it is highly probable that global economy would now be in a sorry state.
A must buy book.
The definitive inside account of the fiscal meltdown August 2, 2010
Rolf Dobelli (Switzerland)
If books about the 2008 financial collapse are starting to run together in your mind, rest assured that former Treasury Secretary Henry M. Paulson Jr.'s memoir is unique. In the first account by a high-ranking government official, Paulson lets out some juicy details. He describes the dry heaves and insomnia he suffered throughout the crisis, his pithy banter with President George W. Bush and his irritation with the ever-perky Sarah Palin. Even so, readers get the sense from his carefully scrubbed copy that Paulson is holding back. Alas, you may have expected as much - loose lips don't help one become Treasury secretary or CEO of Goldman Sachs (his former job). Still, this memoir is enlightening for his personal perspective. getAbstract recommends it to taxpayers and policy makers seeking insight into the interactions of Washington and Wall Street.
 Hank Paulson - Fall Guy or Participant? July 20, 2010
John Fitzpatrick (São Paulo, Brazil)
The opening chapter of former US treasury secretary Robert Rubin's Autobiography "In An Uncertain World" is called "The First Crisis of the 21st Century" and describes his involvement in the Mexican financial crisis of 1995. He tells us on the first page that: "I told the President (Clinton) that the Mexican government faced an imminent threat of default and that, in the hope of preventing it, we were recommending that he support a massive, potential unpopular, and risky intervention: providing billions of dollars to the Mexican government to avoid a collapse in its currency and economy."
The former Fed chairman Alan Greenspan's "The Age of Turbulence" tries to outdo Rubin's melodramatic opener and tells us that he was flying back to the US from Switzerland on the fated day of September 11, 2001 when a security official told him: "Mr. Chairman, the captain needs to speak to you up front. Two planes have flown into the World Trade center."
Hank Paulson, the treasury secretary under George W. Bush from 2006 until 2009, starts off in similar theatrical style: "Do they knowing it's coming, Hank?" President Bush asked me. "Mr. President," I said, "we're going to move quickly and take them by surprise. The first sound they'll hear is their heads hitting the floor."
So whose heads are we talking about - Osama Bin Laden, Saddam Hussein, Fidel Castro or other assorted bad guys? No, Paulson was aiming for the CEOs of two giant state-backed mortgage agencies with the unlikely names of Fannie Mae and Freddie Mac. Almost 200 pages later he succeeds in breaking their heads but not before Wall Street's reputation is in shreds and billions of dollars have been lost in market capitalization and long-established firms like Merrill Lynch, Lehmann Brothers, AIG, Citigroup and others either go to the wall or are rescued by the US government, allegedly the arch-supporter of capitalism and the free market.
Paulson was at the center of these events and he must have been dealt one of the worse hands any treasury secretary has ever had, i.e. apart from Timothy Geithner who had to take over the mess when the Obama administration came into office and Paulson disappeared.
Was Paulson a fall guy or did he make things worse? He certainly had few supporters in Congress and many Republicans were furious with his decisions which they saw as thinly-veiled socialism.
Although Paulson was a participant in events, his style is dry and dull. His attempts to inject some life flop - describing a jog around Washington, references to birdwatching or his panic attacks, "dry heaves" as he disgustingly refers to them.
He is best at attacking politicians for being politicians but anyone can do that just as politicians are good at attacking financiers who make enormous amounts of money for being financiers as Paulsom did. The result is that the book has too many accounts of meetings and phone calls Paulson had with bigwigs in Wall Street and Washington, most of whom are unknown to the folks on Main Street.
It would have been better had he been more forceful in denouncing those he felt were responsible. However, whenever a criticism appears, a qualification follows quickly and diplomacy steps in at the expense of honesty and truth.
At the same time, he is also pretty open about many of his mistakes - probably a first for such a Wall Street high flyer. Nevertheless, he made many mistakes and his position as a Wall Street insider makes one wonder whether the US should reconsider its poacher turned gamekeeper approach to such an important post.
 Honest, candid and straightforward - but bettered by Sorkin's book March 22, 2010
O. Buxton (Highgate, UK)
6 out of 6 found this review helpful
Disclosure: The author was once my boss, although there is no prospect he'd ever have known that. I was a mere halfling among 25,000. Consequent additional disclosure: by dint of said employment, once upon a time I suppose I helped, in a small way, "the Vampire Squid jam its blood funnel into anything that smelled like money", as it was so enchantingly put in a celebrated Rolling Stone article. It didn't feel like that's what I was doing at the time. Honestly.
Now: seeing as it is perhaps the defining socio-economic and political sequence of events since the Second World War: the-near-collapse-of-the-Western-Capitalist-system-as-we-know-it; the horrifying few months triggered by (but not really including) 2007's "Credit Crunch", which brought down Bear Stearns, Lehman Brothers, Merrill Lynch, AIG, Washington Mutual and ran such veritable institutions as Morgan Stanley and even the dear old Vampire Squid itself close, it's odd that it doesn't have a convenient label. So let's call it "The Meltdown".
There have been many - and are sure to be many more - rip-snorter accounts of The Meltdown (my favourite, present company excepted, being Andrew Sorkin's Too Big to Fail) but most suffer, at the limit, from the need for well-intended guesswork. For this was a crisis of momentous actions taken by a few individuals and went on largely discreetly and behind securely closed doors. Any journalist, no matter how good her sources, is forced into educated speculation or must rely on hearsay for the vital exchanges. After all, who said what to whom is the real story of our Close Brush With Apocalypse.
I say most accounts of the Meltdown suffer this failing; this one doesn't: If ever someone were placed to write the definitive account of the near-detonation of the capitalist system as we know it, it is Henry J. Paulson Jnr., 74th secretary to the U.S. Treasury.
In pretty much every significant exchange, Paulson was there; in most cases creating it. Prior to assuming that role in 1996, Hank Paulson was CEO of the good old Vampire Squid (did I say Vampire Squid? I meant "Pre-Eminent Global Investment Bank"), Goldman Sachs for a decade leading up to The Meltdown. As is the habit of Goldman high executives, on 2006 - when all was peachy - Paulson did the decent thing in the name of "public service", stopped poaching and turned game keeper. If he had had any inkling of what was coming down I dare say he would have run for the hills. As it was, he accepted the role only reluctantly. Though it seems odd to say it, we should all be thankful that he didn't, and therefore didn't. Paulson's unique expertise, integrity and idiosyncratic personality may just have made the difference. It was a pretty scary couple of months. It really could have gone thermonuclear.
About that idiosyncratic personality. For a certified Master of the Universe (and a boss, as a matter of fact), Hank Paulson was - and is - a singular and peculiarly likeable man, and this book is very much in keeping with his bluff demeanour: not cut from anything like the same schmoove-schmoozing lounge suit cloth as his contemporaries, Paulson, a gruff, hoarse, angular figure who wears a Casio watch, eschews medicine on faith grounds (other than an obligatory plastic cup of diet coke at breakfast), genuinely cares about the environment (resorting to "birding" with his wife at all conceivable opportunities, including for a half hour before dinner at Camp David, which makes for (unintended) comic relief in an otherwise pretty grim book). He's no politician, either - his lifelong blunt directness often ruffling the carefully coiffured plumages of the political classes. Charm being so important on Wall Street and Capitol Hill, it does make you wonder how Paulson got anywhere near as far as he did, but his social cack-handedness is charming in its way, and on at least three other vital scores Paulson has a very long suit: integrity, intelligence and experience. Paulson's candid assessment of his own social awkwardness navigating the tricky waters of Capitol Hill is disarming.
This is a great account of The Meltdown and in the abstract it has much to recommend it. Were it not for the competition, I'd recommend it unhesitatingly. Its misfortune is to pale, as a piece of writing and narrative, in comparison with the excellent Too Big To Fail. So, if you were going to read one (and only the truly dedicated would need more than that), I would read Sorkin's book. The irony is that (seeing that Paulson largely validates Sorkin's narrative) only by Paulson's book's existence is Sorkin's rendered fully credible.
Now I'm confused, but I think I know what I mean, and hope you do too.
Olly Buxton
Paulson's account does not disappoint March 17, 2010
Gaurav Sharma (London, UK)
There have been a good few books on the financial crisis, but Treasury Secretary Hank Paulson's account was perhaps among the most eagerly awaited ones. That is understandable because he was the man at the centre of one of the biggest, perhaps the biggest financial storm of our times. This part predictable, part gripping and part frank book does live up to the billing the market gave it prior to its general release.
Paulson has told it like it is and as best as he could. He notes the unhinged irony in actions he had to take in order to protect capitalism's near breakdown. "To protect free-enterprise capitalism, I had to become the Treasury Secretary who would forever be associated with government intervention and bank bailouts," he writes and then goes on to narrate some astonishing and gripping anecdotes.
For example, he reveals that Russia urged China to sell its Fannie and Freddie bonds to trigger a bailout of the both agencies and how the British Government prevented Barclays from buying Lehman Brothers, just hours before Sunday-night deadline aimed at preventing its bankruptcy. Anecdotes already in public domain such as Paulson's impassioned pleas to U.S. House of Representatives speaker Nancy Pelosi are re-narrated by the man himself.
Some characters caught in the financial storm are portrayed by Paulson in a favourable light, others not so. Most notably, these include Chairman of the U.S. senate committee of banking, housing and urban affairs - Chris Dodd and Dick Fuld, the boss of Lehman Brothers.
Overall, this book is a highly readable account of events as the financial crisis unfolded. However, what really made me turn page after page was the sincerity of the narrative. Instead of writing a run of the mill book about his time in political circles, Paulson chose to pen down his strengths, weaknesses, mistakes and frustrations. It must have been a painful exercise, but he has done it and done so frankly and brilliantly.
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