I cringe along with everyone else at the notion of Henry Paulson
spending up to $1 trillion in public money to buy bad
mortgage-backed securities from failing financial institutions.
There is one potentially bright spot, pointed out by (gulp) Barney
Frank: These securities will be purchased at a steep discount, and
will be worth a whole lot more after restructuring. The software
was always right. Securitized mortgages paid off, even allowing
for defaults. Right now, somebody with some authority needs to
engineer the financial rework. Congress just wants to wait around,
then point fingers. Paulson has been given the authority, and,
unfortunately, he has to use it.
