The 2008 Mortgage Crisis: Henry Paulson

Background Henry Paulson was a banker and served as the 74th secretary of the US Treasury Department. Born in 1946, Paulson is an internationally recognized economist who proposed a solution for the 2008 mortgage crisis. Paulson launched a rescue program to support organizations in danger of collapse. Paulson's early career started with Pentagon as Deputy Secretary of Defense Secretary of Defense (1970-1972). Between 1972 and 1717, during the Nixon administration, Paulson served as assistant to John Ehrlichman.

On September 19, 2008 Treasury Secretary Henry Paulson proposed a plan to improve difficulties due to the subprime mortgage crisis. He proposed a Problem Asset Relief Program (TARP). It was later incorporated into the emergency economic stabilization law. Determining the value of securities is very difficult. US Treasury Secretary, Federal Reserve Chairman, US Securities and Exchange Commission, Parliament Leader and US President are promoting plans to support securities that deal comprehensively with non-current mortgage issues. Meanwhile, the president later talked as follows.

Treasury Secretary Henry Paulson asked Congress to approve a $ 700 billion bailout plan to purchase mortgage-backed securities with default risk. By doing so, Paulson wants to remove these liabilities from bank books, hedge funds and pension funds holding them. His goal is to revitalize the operation of the global banking system and to end the financial crisis. This bill sets out a problematic asset rescue plan. The initial version of Paulson was designed around the reverse auction. Banks with problems send bids to sell their assets to TARP. Each auction is for a specific asset class. The TARP administrator selects the lowest price for each asset class. This will help the government not pay heavily for non-performing assets.