blasher, it's easy to understand why there's little or no confidence. The London Times, not the U.S. press, explains how Kashkari and Paulson came up with the $700-billion bank bailout number. Two
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In February 2008, Mr Kashkari was charged with drafting an emergency plan in case the credit crunch became a full-blown financial crisis. By October the crisis had arrived and his ten-page plan became the blueprint for the banks' bailout that Mr Paulson presented to Congress.
Mr Kashkari admitted that he plucked “a number out of the air” when deciding with Mr Paulson how much funding to request from Congress for the Tarp.
He told The Washington Post that he used his BlackBerry to calculate the bailout figures: “We have $11 trillion residential mortgages, $3 trillion commercial mortgages. Total $14 trillion. Five per cent of that is $700 billion. A nice round number.”
Recalling a conversation with Mr Paulson, he said: “It was a political calculus. I said, ‘We don't know how much is enough. We need as much as we can get . What about a trillion?' 'No way,' Hank shook his head. I said, 'Okay, what about 700 billion?' We didn't know if it would work. We had to project confidence, hold up the world. We couldn't admit how scared we were, or how uncertain.” The American Bailout Nightmare - Times London
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