Former Treasury Sec. Paulson On The 2008 Crisis

Former U.S. Treasury Secretary Hank Paulson describes the moment he knew Lehman Brothers’ fall meant the global financial system was at risk. He also relives his conversations with congress to get emergency powers for TARP and defends the bank bailouts.

Watch the premiere of the CNBC Original “Crisis On Wall Street: The Week That Shook The World” Wednesday, Sept.12 at 10pm ET/PT.

Ten years after the fall of Lehman Brothers, CNBC has produced the definitive televised account of the historic bankruptcy and cascade of events over a September weekend in 2008 that led to the worst financial crisis in generations. In this prime time original documentary, Andrew Ross Sorkin, CNBC anchor and author of the groundbreaking best-seller "Too Big to Fail," reports on how the nation and the world came as close as ever to a full economic collapse.

The story is told through gripping interviews with those at the highest reaches of the U.S. government as well as the CEOs of the nation’s largest banks who gathered to try to save Lehman Brothers from failure. Wall Street chiefs Jamie Dimon, John Thain, and others describe dramatic, around-the-clock negotiations. Former U.S. Secretary of the Treasury Hank Paulson tells of the desperate moment when he realized that a Lehman bankruptcy could bring down the world’s financial system.

Could a financial crisis of this magnitude happen again? Sorkin puts that question time and again to the people gathered for this CNBC documentary, who shouldered the fate of the world’s finances and who recall the nightmare scenario they faced down ten years ago.

"It would be breadlines across the country for a generation,” former president of the N.Y. Federal Reserve Tim Geithner told Sorkin. “We did feel that we were making choices and faced with outcomes that would be devastating to the lives of hundreds of millions of people."

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Former Treasury Sec. Paulson On The 2008 Crisis | CNBC

[kortyEdna]

I wonder if people that experienced the 2008 crash had it easier because this market conditions are driving me to insanity, my portfolio has lost over $27000 this month. alone my profits are tanking and I'm don't see my retirement turning out well when I can't even grow my stagnant reserve.

[javiersp]

So basically the movie Too Big to Fail is mostly accurate.

[silentman]

We came so close to a DEPRESSION. An AIG bankruptcy would have taken down the entire financial system in a matter of hours

[kevinswift]

There was 0 legal talk about a Lehman rescue being illegal, nor was there any talk of it being a huge disaster. In fact, in the Fed meeting on on Sept. 16, 2008, the day after Lehman's failure, there was talk about how the Fed had done a good job of holding the line against moral hazard.

The idea that Paulson or Bernanke or Geithner knew about the consequences of Lehman's failure but simply had no authority to act only came up a couple of weeks later. All of this is documented in the FCIC report.

[pokerus]

Paulson looked like he was conducting an orchestra with his hands. The entire times he was talking with his hands lol

[tarikberair]

“Once in every 75 years event” .... that’s for natural disasters, not man made banking crisis.

[mundrakeshav]

After reading the book Too Big to fail, I respect him for taking tough decisions.!

[alrivas]

Love Too Big Too Fail and HBO for being known for making great movies like that. I’m thinking this Sorkin guy might have a bright future 😂

[tomast]

He's a legend and he has a great, great character.

[Herman]

Seems to me that Mr. Paulson tried hard to avert an even worse crisis.

[Pyrrhic.]

To understand market structures. If banks were a competitive market, then intervention isn’t necessary because markets will stabilize. The fact that banks are an oligopoly, the sector is not competitive. Thus the application of “competitive market” and “no regulation/intervention” fails. If you studied above intro to macroeconomics, you would learn that different types of markets require different policies.

For the present day, the US either need to to break up the banks or risk bailing them out again on the next crisis. No getting around the moral hazard.

[libertysprings]

People can be so mean. He had enough money to just leave and ignore the whole crisis but he STAYED and took the heat. Brave and patriotic man.

[MagnusAnand]

The excesses in the financial markets that he helped to create as Goldman’s Sachs CEO…

[hironmoymondal]

Here we are in 2020 and things are again getting started !

[doresearchstopwhining]

So let me get this straight. You went to talk to Bush about entitlement reform (ie rolling back social security benefits) and instead you brought up how to limit the "excesses" on wall street. As an ex CEO of Goldman, I find that hard to believe.

[ask_why]

I-I-I looted the American taxpayer to save the stock market and my Wall Street banker pals. You're welcome.

[cwebb]

Looking like Bobby Ricky with those hand movements. Like it or not, this man saved the American and the world economy

[Sigma.]

"The British have screwed us" 😂😂😂

[NJOYtommy]

Please correct me if I'm wrong, but it sounds to me that Paulson said to Bush, you better buy all our debt if you want to avoid an "even bigger" financial crises. What happened to Bush? Can't think of a better time to say his famous phrase: We don't negotiate with terrorists.

[Dustinwhy]

Ppl can complain about bailouts, but had they not acted, life as we know it would’ve stopped entirely. It was a necessary evil.