Henry Paulson

Paulson has announced he is spending an additional $600 billion to buy up toxic mortgages:

The Federal Reserve announced Tuesday that it will purchase up to $600 billion in mortgage-backed assets, the toxic assets that have been weighing down embattled government-sponsored enterprises like Fannie Mae (FNM: News ) and Freddie Mac (FRE: News ).

Buying troubled assets – what a novel idea! Isn’t that what TARP was for? Yes it was, but that moron Paulson decided to do something else. So we have $600 billion on top of the $700 billion approved by Congress. When will the hemorrhaging stop?

That’s what Paulson decided to tell Congress today:

What I also find interesting is how they are now saying they will leave Obama with about 1/2 of the $700 billion from the bailout. So why didn’t they just ask for $350 billion to start with? Why all the drama and demanding the full $700 billion? These people have very serious questions to answer.

And to think that everyone was bitching about the $700 billion bailout:

The Federal Reserve is refusing to identify the recipients of almost $2 trillion of emergency loans from American taxpayers or the troubled assets the central bank is accepting as collateral.

Fed Chairman Ben S. Bernanke and Treasury Secretary Henry Paulson said in September they would comply with congressional demands for transparency in a $700 billion bailout of the banking system. Two months later, as the Fed lends far more than that in separate rescue programs that didn't require approval by Congress, Americans have no idea where their money is going or what securities the banks are pledging in return.

Hopefully transparency isn't going to be an optional issue come next year.

UPDATE:

It also turns out that Henry Paulson also issued a memo to banks basically eliminating their taxes. It does have members of Congress upset, but they don't want to stir too much because it could lead to a bigger financial crisis.

Also AIG maybe seeking another $150 billion in bailouts.

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