Paulson

My son in law and I were discussing former Treas. Sec. Paulson back in Octobber when he seemed to take charge of the government response to the financial crisis.  My son in law has worked very successfully in investment banking in NYC. We both agreed Paulson had the background and understanding to deal successfully with the crisis.  Since than many have said he screwed it up.  Why?  Ben Stein had an insiteful article in last Sunday's New York Times.  The most experienced and brightest are still just people.  Knowledge, talent, experience may be necessaries to success, but they are not sufficient.  People act and re-act to reality for many reasons.  We know this. Smart people do dumb things.  What Paulson forgot, I think, was to keep in mind the changing Global reality. What we should each strive to do as we navigate our own lives is: check frequesntly how the overall environment is changing, re-examine our overall strategy based on that changing reality,  verify that our immediate tactics will still be successful.  Maybe Paulson some of did this.  Maybe new information required, in his mind, that he change course.  But he seems to have forgotten the changing Global reality.  As confidence waned in the international financial and business communites,  his changing tactics appeared capricious.  One example, PNC Bank and Nat City both applied for TARP funding.  He granted PNC's request, rejected Nat City's request.  PNC promply bought Nat City with TARP funds. Paulson did not see the effect a lack of public explaination would have on the global reality. This was one of many unexplained decisions he made.  Business needs to undertand what the rules are, or busness and its investors get very leery of putting money at risk.  That is where we are now. Not all your fault Hank, but some.