Thursday, April 02, 2009

The Financial Crisis an Inside View--Let the Games Begin

Phillip Swagel, a former assistant Treasury secretary for economic policy under Henry Paulson, has written a 50 page paper that details the inner workings of the Treasury from December, 2006 through January, 2009. This is certain to be controversial once disected. Swagel will present the paper at the Brooking Institute Friday.
The Treasury predicted in May 2007 that “we were nearing the worst of it in terms of foreclosure starts” and the problem would subside after a peak in 2008. “What we missed is that the regressions didn’t use information on the quality of the underwriting of subprime mortgages in 2005, 2006 and 2007,” Swagel said. Very interesting that a former Treasury assistant would admit that the Treasury was clueless.
You can read the entire paper by following this link.

Or, for a cliff notes versioin you can cha cha over to the Wall Street Journal and read this piece--What Was Going on Inside the Paulson Treasury?

Let the finger pointing and revisionist history begin.
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