U.S. Facing Crisis Without All Necessary Tools, Treasury's Paulson Says

Treasury Secretary Henry Paulson said the government has had to face the current financial crisis without all the means to do so effectively, the Financial Times reported on Tuesday.

"We're dealing with something that is really historic and we haven't had a playbook," Paulson said in an interview with the newspaper. "The reason it has been difficult is first of all, these excesses have been building up for many, many years. Secondly, we had a hopelessly outdated global architecture and regulatory authorities... in the U.S."

However, Paulson is optimistic regarding the progress that has been made since the Troubled Asset Relief Program was introduced and approved, and defended his decision to reallocate funds from asset purchases to recapitalization schemes for banks.

"People say banks aren't lending enough. I agree with them - banks aren't lending enough," Paulson said. "But there would be much less lending if the actions were not taken that were taken to increase the confidence in the banks."

Written by CEP News European Staff and edited by Stephen Huebl
©CEP News Ltd. 2008