------ Forwarded Message > From: "dasg...@aol.com" <dasg...@aol.com> > Date: Sat, 30 Jan 2010 19:22:07 EST > To: Robert Millegan <ramille...@aol.com> > Cc: <ema...@aol.com>, <j...@aol.com>, <jim6...@cwnet.com>, <l...@legitgov.org> > Subject: Revisionist Economics: Bush's Treasury Secy Blames Meltdown on > Russia/China >
> Russia tried to exacerbate US financial crisis > Russian interests attempted to force the U.S. government bailout of Fannie Mae > and Freddie Mac by selling off its <<increasingly worthless>> holdings in the > two entities in 2008, then urging China to do the same, according to former > U.S. Treasury Secretary Henry Paulson. > Paulson's claim is carried by his forthcoming memoir, ³On The Brink.² An early > copy was obtained by Bloomberg News > <http://www.bloomberg.com/apps/news?pid=newsarchive&sid=afbSjYv3v814> . > > http://www.bloomberg.com/apps/news?pid=newsarchive&sid=afbSjYv3v814 > > "The Russians made a 'top-level approach' to the Chinese 'that together they > might sell big chunks of their GSE holdings to force the U.S. to use its > emergency authorities to prop up these companies,' Paulson said, referring to > the acronym for government sponsored entities," Bloomberg reported. "The > Chinese declined, he said." > > He reportedly added that he waited until returning to the U.S. before > informing former President George W. Bush of what he called a "disruptive > plan." > > Indeed, Bloomberg adds that during the opening ceremonies of the Beijing > Olympics, Russian Prime Minister Vladimir Putin warned Bush that ³war has > started,² according to Putin¹s spokesman. The Kremlin has since denied that it > urged the Chinese to sell bonds in Fannie and Freddie amid the height of the > mortgage crisis. > > In Paulson's memoir, he also claims that "Alistair Darling, the UK chancellor, > blocked a rescue takeover of Lehman Brothers by Barclays Bank when he refused > to support special treatment," Financial Times noted > <http://www.ft.com/cms/s/0/ffd950c4-0d0a-11df-a2dc-00144feabdc0.html> . > > [The British] had been under pressure by New York Federal Reserve chief > Timothy Geithner to waive the requirement of a shareholder vote to approve an > accelerated merger between the two firms. > > Darling refused "without a hint of apology in his voice," Paulson claims. > > Russia held some $65.6 billion in Fannie and Freddie bonds at the beginning of > 2008, according to Bloomberg. They have since been sold off. U.S. regulators > seized the banks in Sept. 2008. > > Congressman Barney Frank (D-MA), who chairs the House Financial Services > Committee, said recently > <http://rawstory.com/2010/01/frank-house-committee-propose-a-system-housing-fi > nance/> that both banks could be abolished following a complete reformation > of how home mortgages are handled in the U.S. He expects the committee to > make a recommendation to that effect. > > Peter Wallison, a former general counsel to the U.S. Treasury, estimated at > the end of 2009 that taxpayers would lose in upwards of $400 billion > <http://www.businessweek.com/news/2009-12-31/u-s-to-lose-400-billion-on-fannie > -freddie-wallison-says.html> for its support of Fannie and Freddie. > ------ End of Forwarded Message
