Under very adverse circumstances that prevented a disaster. Something tantamount to the Great Depression. Rose we continue the story of Henry Paulson five years after and the Bloomberg Business documentary with josh tyrangiel, the editor of Bloomberg Businessweek and Joe Berlinger the filmmaker and hank paulson stays with me. So i entered it with healthy skepticism, got to know hank, read the book, dug in, and i did a complete 180 and i became convinced and you see hit in the film. I became convinced that hank was the right guy in the right place who did some amazing things, got congress to act twice on some huge moves and so for me it was a fascinating experience. I went in thinking one thing and came out on the other end. Rose hank paulson and josh tyrangiel, the editor of Bloomberg Business week and the film maker who made hank five years from the brink. Next. We begin tonight with hank paulson. Five years ago this month the world was gripped by the worst financial crisis since the Great Depression. The u. S. Economy was brought to its knees, starting with the failure of Investment BankLehman Brothers on september 15, 2008. Soon, several of wall streets most venerated institutions were teetering on the edge of insolvency. The governments response was unpresident ed in its size and scope. The troubled Asset Relief Program known as tarp injected capital directed into the banks and brought a pause to the crisis. As treasury secretary hank paul son was at the senter of this and other decisions to stabilize the american economy. He looks back on his actions in the new documentary hank five years from the brink. Heres a look at the trailer. By anyones measure, we are living in extraordinary times. Prices are at an alltime high. My goal has not been to go to washington. Im pleased to announcely nominate Henry Paulson to be the secretary of the treasury. I didnt know president bush. There was a high likelihood that there would be a financial crisis when he was president. The latest financial giant in distress. We are watching this market the lowest in 15 years. None of us understood the extinct of what we were dealing with. Bear stearns, merrill lynch, Lehman Brothers. Holy moly how could this be happening . Economists believe we are now in a recession. I saw this moving from wall street to main street. Everyday the American People get angrier. Losing farms and homes. Breaking me, for real. We need to do something dramatically. We cannot simply assist wall street. You wanted 750 billion from congress. Hank was doing things that were offensive to him. Too big to fail is not acceptable. Rose congress these act. Were out of options new york city fat cats expect joe six pack to pay for all this nonsense. The public wanted to hear those that made the mistakes are going to be held accountable. and theyre going to come back and ask for more what we did was not for these banks, it was to save main street from a catastrophe. Its important that there be a historical record, so we dont replay this movie all over again. Rose i am pleased h. O. V. Hank paulson back at this stable and in the interest of full disclosure, hank paulson has been and is a good friend of mine. So welcome back. Charlie, its great to be back. Rose does it seem like a long time ago or yesterday . Ill tell you, it seems like a long time ago but whensy Start Talking about it again and working on the documentary or writing the prologue to reissue on the brink, it comes back immediately. And my stomach tightens up all over again. Rose when you look back did it change you . Did you come to some new understanding of yourself because of this . Wow, you know, you cant go through a process like that, an experience like that, without being changed. Everything we go through thats difficult causes us to grow. We find were able to do things we didnt think we would be able to do. So it makes a difference. And when you go through something as consequential as that it its a lifechanging experience. How so . It was the defining professional moment of your life . Right. Well, i have have to say charlie and dont get this wrong because this was a miserable experience for me and for the American People whove suffered as a result of the crisis but i also feel an enormous sense of satisfaction knowing what we accomplished and what we avoided because i think we did some pretty remarkable things under very adverse circumstances that prevented a disaster. Something tantamount to the Great Depression. Rose thats the key. You avoided Something Like the Great Depression. In your judgment . In my judgment. And i think almost everyone i know that understands markets really well go as close to the edge we were. Rose how close sfwherp yeah, how close we were. The second thing is it was harrowing to be able to look into the abyss and because it was this harrowing, i still there are times when i think about it and it becomes stressful all over again just thinking about it and thirdly this experience tended to strengthen the important relationships i had even more, the relationships with family, the relationships with people who will went through this together with me. Rose your colleagues. My colleagues. My colleagues tim geithner, ben bernanke. My colleagues at treasury. And then i would say lastly spiritually i feel im i feel closer to god. It just it was a just an important experience for me. Rose has distance given you new perspective . Of course. Of course. How could it not . And frankly thats the reason why i wrote the prologue to the book. Rose this is on the brink in which the forward a new forward from you. Yes. So in the book, in terms of laying out exactly what we encountered, how we dealt with it, why we dealt with it the way we did and you know when i reread it it just gave a great sense of what was going on but i wanted to layer on to that the perspective that five years had given me and frankly as i looked back i felt much better than i did at the time because at the time i was saying how could it have taken so long to act . And i look back through an entirely different lens i looked back and i was just so grateful that first of all the relationship they developed with the president and it had trustee place in me and the support he gave rose called you his wartime general. And the support he gave me and the fact that he was prepared to make the kinds of tough, unpopular decisions and then even those that i had a more difficult time with when i was up at congress that ultimately supported tarp i look at it and say wow, they knew that they were voting for something that was unpopular, that was going to hurt them and the fact that watching democrats and republicans come together i feel very good also about the transition to the next administration. The degree of policy continuity was extraordinary, you know, in terms of the Capital Markets programs. At the time i didnt see that as clearly but when president obama ticked tim geithner who had been such a key part of putting all that together i think that made it that was just key because theres a natural tendency for any president coming in to respond to the base and say lets throw out what the other guys did, lets do it better. But they made the decision which couldnt have been an easy decision for the president to support tim, keep the current Capital Markets programs and they ran them very well. So i feel good about all that. The thing you look back with some dissatisfaction is that you think you werent able to convince enough people in the country that you were not favoring the big banks over main street. Charlie, thats a nice way of putting it. Youre a friend. Thats an understatement. I wasnt able to make that sale. I just wasnt able to convince people. It was so obvious to me i was the treasury secretary of the United States of america. Rose former c. E. O. Of goldman sachs. Thats right. Former c. E. O. Of goldman sachs. But id left goldman sachs. Id severed my relationship at goldman sachs. Every single thing i did was to protect the American People. But i never convinced them they never and it was a hard sale to make because, you know, Financial Markets are sort of like plumbing. People dont see all the different pipes and it wasnt readily apparent to them the connection between the actions we took and the capital they needed to live the way they wanted to live, to borrow money, send their kids to college, to buy a car, to buy a home. And i dont think they understood. I was looking at it and saying boy, another big institution goes and theres so much concentration thats all she wrote. How we will ever start these banks up again if they close . What will happen . But the American People didnt see that and and so one of the very hardest things for me was leaving in 2009 and looking at some of these polls and some of the polls, the tarp programs, our programs, were more unpopular than torture at the time. And it just i realized rose thats right, there were polls that said exactly that. Yeah. Rose torture was there were rose torture was at 60 or whatever it was and tarp was at 90 . Rose and you blame yourself for not being able to communicate better consequences for the country if the Financial System collapsed . Chargely, i do. Its an interesting thing. I on the one hand i believe i was an excellent communicator in smaller meetings one on one building trust, getting things done in a year before the financial crisis working with democrats, working with republicans. And when it was poisonous in washington and getting the building relationships with democrats like barney frank and nancy pelosi and harry reid in addition to the republicans. Building the relationship with the president , with ben and tim, working. So im good at that and thinking of them as clients. But speaking publicly its something that doesnt come naturally to me and then i was also reticent to explain this for fear it would make it worse. I hate to say. Rose you couldnt explain to people how bad this was because you thought fld make people lose confidence because markets are built on confidence. Totally, charlie. And so for instance when i went up to the hill i rad emanuel, for instance, explained it the bast to me because i was complaining that i didnt want to have to explain how serious it was to the American People. And he said well, youve got your market and weve got ours. And there was this giant clash between politics and markets and members in the senate and house wanted me to explain how disastrous it was going to be if we didnt get the tarp and i was afraid if i explained in the gory details it would make that which we most feared come upon us. I wasnt wanting to talk about what would happen if the banks closed down and couldnt open up or what happened when Industrial Companies couldnt raise financing because i thought that would cause the panic to move there. And even after wed taken the step wesd taken i still lived in fear that i wouldnt have the last the for the tarp and as big bank would go down and that would be all show wrote. So i wasnt trying to in graphic detail explain all of this. Rose what would have happened if morgan and goldman had gone down . Well, look at it this way look at what happened with all the actions we took, how serious this situation was. If wed had number any other Major Institution. Wamu was bought by j. P. Morgan as it failed. Wachovia, the United States of america for the First Time Since the Great Depression the president invoked these emergency authorities that were to be used as part of an acquisition. So to me any other Major Institution would be cataclysmic. I tell the story in my book about citigroup the second time. And i had heres an institution with three trillion in liabilities, 500 billion in deposits outside the United States that dont enjoy the deposit insurance in the United States of america and if if that institution had gone down, i dont know how many others could have stayed solvent with all the interconnectivity among the institutions. So we were the week that lehman failed, you know, we were juggling multiple things. It would have been any one of them would have just a fivealarm fire. We had were dealing with a. I. G. Which the same you know, the same weekend that we knew lehman was failing a. I. G. Came and said we were going down. So this wasnt because of lehman they had their own problems. Merrill lynch was on the brink. So afterwards after lehman had failed, i couldnt stand up, at least in my judgment, to say hey, guess what . The United States of america, we tried and we didnt have the fed didnt, treasury couldnt guarantee liabilities, capital alone wouldnt have worked, we had not a single power to save them. Or at least i was afraid that Morgan Stanley would go down the next day. So we had these other big institutions, we had a. I. G. , we had the money markets imploding and then most important of all going to congress to get these authorities and theres nothing worse than going to congress and saying we desperately need these and then not getting them. And so to figure out how to have all that work is extraordinary. Rose whats important about this conversation in this film is its five years after. Theres new information. These three Big Questions are out there. What would have happened . Lets assume you could have if you argue theres no way you could have you can come back to that question. If you could have saved lehman what would have been the consequence . That would have done what . Well, heres the right way to understand that because you have to agree with me to start off that it took a buyer to save lehman. The government could assist a buyer, the fed alone, like they did but it took rose with j. P. Morgan and right . So it took that buyer and so i knew at least i thought going into the weekend we needed two buyers because i said to myself if first of all if theres a buyer for lehman than the market will turn immediately to may recall and if theres not a buyer for may recall, may recall will go. And, of course, if lehman goes without a buyer for may recall, plarl go also. So i think the first thing i would say is we only had one buyer and the reason was which people forget is this crisis had been going on for more than a year when lehman went. So banks in the u. S. And in europe were stressed. The system was already on the brink, very fragile. So lehman wasnt the cause, lehman was the symptom. I tend to use my colleagues popcorn analogy, so then what i say very simply now i didnt say it at the time because we were working desperately to save lehman but looking at it now i say by gosh if b of a had bought lehman which we were trying to facilitate then merrill would have failed and it would have been worse because it was bigger. Rose and nobody would have saved merrill. Yeah, theres no one there. We didnt have the powers to deal rose the only way to save lehman was to have somebody prepared to buy it and you could back them up . You could back them up, you could facilitate it. You could give them some help along the way, but thats what we learned up cos and person with bear stearns. But the market wasnt going to accept that. The when an Investment Bank was imploding it took j. P. Morgan and j. P. Morgan had to be willing to guarantee whole trading book during dependency of the shareholder, as youll recall. So as i look back on it and the other thing i look back with 20 20 hindsight on and we were pressing so hard on to have barclays buy lehman and the regulators rose it looked like they might for a while. They wanted to, they would and then the regulator wouldnt let them. If you look at it right now im not sure the market would have accepted that if that would have been rose because because at the end of the day what we needed to step back even further, as i look at it now, i look at it and say, wow, we knew this is a serious problem but but what happened in 2008ing is a giant is a huge credit bubble which is building for years and years burst and institutions throughout the world, the u. S. And europe were undercapitalized and what the tarp did, as you said . The introduction, what the tarp did which is no other Capital Program i think thats ever been done before like this, we didnt deal with we didnt deal with banks as they failed, we got out and put in capital in hundreds of banks. Tarp let us do that. And i think it would have been hard we have went to congress and got the authorities we did the earliest date we could have got them. It took lehman going down for us to do that. Rose these are Big Questions. First, should a lot more people look with the value of hindsight not only 20 20 then but 20 20 now, should a lot of smart people have seen this coming and warned us . Charlie, i dont want this to sound like an excuse because i of course the answer is on the one hand of course yes but i dont think we can ever count on that the nature i giant this as a giant speculative bubble which burst and the nature of a bubble is no one fully understandss it until it bursts. Thats what a bubble is, right . And there will always be a couple people that said, yup, i saw it, look. And but they wont be right the next time. On the one hand as i point out in my book and in the documentary, i thought we were due far crisis . My very first meeting with president obama i saw it coming. He asked what would cause it. I said i dont know because i didnt see 98, i didnt see 94. With 20 20 hindsight it will be obvious. We missed housing not because we didnt see some problems but we were looking through a too Short Historical record. Ever since world war ii Residential Housing prices sort of went up. Rose so there was that history. Nobody has seen circumstances once im sure people have. Rose well, there were people who made money because they did understand. But to understand the full extent i would also say this i dont think theres anybody in washington that i was working with where i was as concerned for the beginning of this crisis and even beforehand and i underestimated the magnitude every step of the way right up until we got the money for from congress and they were prepared to put capital in. Rose do you think executive Financial Institutions did not understand what happened with all these security instruments and had no understanding of the risk that was out there . That is a big part of the problem. Complexity rose yeah, exactly. Is the enemy. It works against transparency. Innovation was good almost anywhere. You can have too much innovation in finance, we had too much innovation, but, you know, i want to there are multiple causes and problems that i want to come back and Say Something else that im convinced is right although it is politically unpopular to say it. And this is the root cause of every crisis in history as far as im concerned is always flawed government policies. Which lead to excesses, ultimately bubbles and then they manifest themselves in the Financial System no matter how its regulated, no matter how it is structured banks always make a lot of mistakes. They rightfully get blamed. They get a disproportionate part of the blame. Thats not a problem. Its only a problem if we dont go and clean up the messes and address the government policies. Rose i think the point is at fannie mae and freddie mac . Im going theres no doubt. So they were ground zero of the problem. They were the vortex of the problem and to me theres nothing we did that was more effective in preventing a meltdown and keeping the housing problem from being much worse. Just think, if there hadnt been Housing Finance what would have happened . But theyre one part of our overall housing problems programs and or housing policies when you look at the mortgage Interest Deduction and the f. H. A. Programs and the state housing programs and then overall and overall we as a country and as a people borrow too much, save too little. The ten years before the ten bubble years 97 to 2007 the median Family Income was flat. But yet americans were doubling what they were borrowing. Rose right. They were borrowing more than they could afford to main unaffordable standard of living. Rose and a few people looked at this and said this is not sustainable. Its one thing to say that, its another thing to see a bubble of the size we got. There was low interest rates, low inflation, money flooding all over the world. Chasing risk, looking for yield, huge imbalances, monies coming from asia. So it was a lot of excesses. Rose okay there is this also some executives felt they were at risk of prosecution, criminal prosecution. The country could look back to the savings and loan crisis and say some financial executives went to jail. No one is going to jail for what happened in 2007 and 2008. Is that simply, do you believe, because there is when people looked at the evidence they could see no criminal wrongdoing . No evidence of criminal wrongdoing . Charlie, thats my assumption and i would say this i know the men who are running a lot of these institutions. Some were more able than others, but they were good people. They werent trying to blow up their institutions. Do you believe what i do that this was a hundredyear storm that these excesses had been building up for years and years in the system we were dealing with something the likes of which weve never seen before, the likes our country hadnt seen and ill tell you if i think we hadnt taken the actions wed taken the results would have been just disastrous. Rose but you are critical of the levels of compensation that existed before and after the crisis in an t extent as to whether it might very well have clouded judgment. Theres no doubt that is a contributing factor, stock . No doubt in my mind thats a contributing factor. I also have said that i thought after the fact, after all that had been done and the understandable anger on the part of the American People i understand. I mean, i know when i look back and say the American People were angry and theyre angry at me and theyre angry at the actions we take, you know, i i get it. I understand it. Because the other people they bailed out the other people and didnt bail me out. I understand it. I know they wanted to hold people accountable and when i had to decide between the stability i always opted on this the side of stability i did it for the American People because i didnt want the economy xhi to collapse, i didnt want them lose their jobs. But so i understand that and i just as i said, i thought it was a colossal lack of selfawareness, very ungracious after all that has been done to see the kinds of bonuses that were paid. Shi understand that that is a problem. What i dont want right now and part of the reason why im doing this is if people look at this and say well, is this the bankers, it was just the bonuses then we wont fix our problems. And we will be back here again. Rose well come back in a moment and talk to the filmmaker and josh to josh tyrangiel, he is the editor of Bloomberg Business week and the man who initiated this business film. Back in a moment, stay with us. Its painful for me when i left office to look at the polls because the way i read the polls tarp was more unpopular than torture. The other criticism of tarp just man on the street kind of feeling was that in addition to not lending they saw huge bonuses being paid, those guys got unconscionable sums of money. I know. That was that infuriated me. Why infuriated you . Well, i okay, laughs i mean, i mean, the here is cheekiness of it. Forgetting about whether they were legally entitled to that, it was just such a graceless lack of selfawareness and a total lack of understanding as to how the rest of the world and the rest of america looked at them. Rose we continue our conversation about hank, five years from the brink. Im hear what former treasury secretary hank paulson. Joining us are josh tier ring gal editor of Bloomberg Business weeks and the films director Joe Berlinger. Here is the new edition of Bloomberg Business week five years from the brink. A lot about paulson and five years later. The question then is this is a documentary film, not a magazine. So why did you decide that you needed to do this film. Ive tried to figure out what the right medium presentation is of any kind of story. And this theres been plenty written about the financial crisis but in my conversations with folks including i dont know if hank know this is but include being tim geithner, one of the way you close a conversation is you say so what have you surprised that we havent covered in the magazines and tim geithner said to this day no one has gotten hank properly. He said he has come off either as too intellectual too fiery and no one quite know it is story at the center and that he took thising on his back and guided us through. And i thought well, thats very interesting and i lead hanks book and met hank a couple years ago at a Panel Discussion about the crisis. And i thought thats interesting. I dont know that we can capture this in print. I knew the five Year Anniversary was coming up and i said, look, the first draft is going to be closing on this story and if you think you have more to say, if you think what youve said so far hasnt been received appropriately, what if we try again and in a different way from a Magazine Editor pitching a documentary about a treasury secretary probably seems odd but to me it made sense rose he did not rush right in . laughs thats an understatement. Rose what did you think . Well, i thought basically theres a story to tell and i want to remind people what it was we faced and how we dealt with it. I clearly wanted them to understand how close we dime going over the edge and then lastly which is something that was i think the most important thing to me is i really wanted to focus on create a sense of urgency and that we dont want a replay. We want to clean up our messes and make sure rose understand the lessons and what worked and didnt work. Thats for sure. Rose i just quarreled with you about the notion of what tim said to you. Ive had one person after another not all of them come on the program and say you were lucky that bernanke and paulson were there. Its the quality of like Warren Buffett that have said that time after time after time. And i think theres a giant disconnect between the people who understand the economy and understand the Banking System and the people who dont. And the people who dont are close to 300 Million People in the United States and to them what happened was frantic, it was confusing, i think, you know one of the things that hank says in the film which i think weve agreed on is its very difficult to commune date in a crisis what is happening and so that to me is where you get a filmmaker like jeff and you say well lets weve had five years, theres time, lets sit down and play it out. These problems the pitch thater of this crisis was thaw the problems were coming at you from all different directions. We talked about this pop corps metaphor. We didnt know which colonel was going to hit you in the eye or the shoulder and what was popping next and joe was able to sit down, speak with hank and draw it out. I think its more than important. So why joe here . You know . What does he know about that . What did he know about finance . Well, the short answer is this that more than you might think. We went to radical media and said, look, we want to put this together and they said joe id seen many of joes films and i thought they were great. I didnt know joe at all but as it turned out this is not New Territory to you. When he will, i was physicianassisted suicide flitted by a couple of things. I had a couple friends who were severely damaged by the financial crisis and i had a lot of personal questions that i wanted to ask hank. I was fascinated by the idea of talking to the guy at the sent over the storm. Rose i know the feeling. The other thing is just capturing the human dimension of this, the human dimension of being at that place at that time was it was an opportunity i couldnt resist. But for me the amazing journey of making this project is i entered this project with a bit of skepticism. Im one of those three hundred Million People despite what i think aboveaverage Financial Literacy compared to nonfinancial people, amongst my friends who are not in the financial industry i think im i have some basic good knowledge but, you know, im im one of those people who probably i guess being the social issues leftleaning documentarian type that i am was leaning towards wondering was this bailout good for main street or just good for wall street . And, you know, so i entered into it with some healthy skepticism, got to know hank, read the book, dug in and i did a complete 180 and i became convinced and you see hit in the film. I became convinced that hank was the right guy in the right place who did some amazing things, got congress to act twice on some huge moves and so far me it was a fascinating experience. I went in thinking one thing and came out on the other end. Which is the best way, i think to experience the making of a film. Rose i heard you say that in the midst of the crisis at press conferences. Its harder to explain what might happen. Barney frank who was such a key part of all of this explained it immediately. I remember when we were up there on thursday, september 18 asking for these Emergency Powers and we explained how bad the situation would be if we didnt get it but that the pluming in the Financial System was already clogged up and the economy was going to turn down and barney said this is difficult politically because you cant prove a counterfactual. And i remember thinking whats a counterfactual . Youre not going get credit for a disaster no one sees. So rather than saying look at how bad they did look how bad it was and how they prevented but just think if the whole system had gone down, they didnt go that far. They just went and said they did it all, im suffering and youve bailed out wall street. Wall street made mistakes but the regulatory system was screwed up, we didnt have the powers we needed. Regulators made a lot of mistakes, congress made mistakes, the rating agencies made mistakes, investors made mistakes and im not defending the banks, thats the last thing i want to do, but if all we say is its all about the banks and we just focus on the banks, banks, banks, well be back here again. Rose everybody was complicit one way or the other. Yes. Rose did you learn anything you didnt snow. I did. In addition to the fact that it we should remember it was only five years ago but the volume of events and decisions a go zillion books. There have been. But part of the reason i thought this would make a great film is that for better or worse hank is completely authentic and i think one oov the reasons that there is confusion during the crisis is that hank appeared sds unlike many politicians willing to be frazzled. Willing to say this is an emergency. People are not used to that in their government representatives and so what we get in addition to this story rose the measure of the man. Yeah. Rose and his wife. We should say that wendy makes the rose that was the best decision. Women who have seen the film come away saying i want a movie about wendy now. You know, you get to realize and i think wendy makes this point that people dont go into government to do a bad job and that they are making immensely important decisions under stress and so you get to understand what hank was taking home with him. Rose this is the larger story. Yeah, its a human story. And because of the confusing nature of the crisis itself there is a great opportunity to unwind it. What you see there is the story of a man and of a marriage and this sort of incredibly important moment in our countrys economic history. I also wanted to explain the major beats of the financial crisis in a way using hank but doing in the a way people can sgras because the numbers staggering and the numbers of crises he had to deal with one after the other is just a blur. And what this film does that im most proud of is i think it takes some very complex material through hanks words and through of course, the chorus of news clips that we use and it kind of just it makes people understand what happened in a way that you dont have to have a business degree to get it. Rose how did you dough the interview. We saw this interesting thing at the beginning of the film where hank is sitting in an empty chair and you talk about what youre going to be doing and theres dialogue and a voice we dont see. Well, i kind of ripped off erroll morris who invented the thing called the interotron where the camera is situated in such a way that hank sees my face and hears me directly through the camera lens this allows me to have Comfort Level of having a conversation with a human being but what it gives the audience is direct eye contact with the audience so people feel like theyre hank is talking directly to them. Rose did you feel like some part of the story you didnt tell, couldnt tell, was impossible to tell . I think we left a few crises out. There were a number of things he dealt with in that sixmonth period that the that at the a certain point i had to strip away and get down to the core elements, any one of which, as hank says in the film, any one of which would be overwhelming for anybody. Ha. Rose is it fair to say beyond you and tim and bernanke that in terms of members in congress and im saying the majority, not everybody responded in a way that was working in the interest of the public . Were trying to make the right decision and were not using this simply as a means for political gain. Absolutely. And as i look at all the dysfunction today and how poisonous the atmosphere was when i arrived i look back with great pride and satisfaction and i really respect the key members of congress on this thing, they knew they were doing something that was going to be very unpopular. Unless you were an absolute idiot and theyre not idiots up there they knew they were making an unpopular vote. And they went about it in a responsible way, they moved quickly. The legislation was very well done and im really proud of them. When you went up from capitol hill that day, what did you tell them. We just said it was going to be an extraordinarily bad situation if the Financial Market collapsed. Now it took a while for the but i think rose that day was. But the other thing i said, charlie, which is a pointsy make here and i dont make this about me but if the crisis has had right away we would have had big trouble as soon as i arrived. I had a year to develop the relationship with president bush of trust which was key to that and i had a year with congress and so i had worked hard to develop relationships on both sides. Id been working with barney frank and others since late 2006 to reform fannie and freddie. I had a chance to work with nancy pelosi and harry reed and a lot of others, john boehner, on getting this stimulus bill done. And so to build relationships up there and relationships of trust. So to build there was a lot of work that had been done and i really saw the best out of members of congress twice. Not just once but twice. Rose i mentioned the fact that what you did and didnt do. Would you do it differently if you had more time and a different moment in terms of how you used not only the interview with hank but also sources to tell the narrative . You know, on the one hand this was a pretty rushed film. Rose you had a deadline. We didnt shoot those interviews until may and there was a tough film to edit. But i like the vibe of the film. We made a conscious decision instead of doing a straightforward documentary where you hear from a chorus of voices and different opinions, i wanted hanks story. Rose what is hanks story . So were seeing hanks story . This is hanks story. People can agree or not agree with it. I wanted to give him a forum to tell this story, be fair about it, introduce some of the criticism via the contemporary the news clips of that time but i do not want this to be an expensive documentary with multiple voices. This was hanks story, the idea of putting wendy in the actually came from hank and i thought that was a brilliant idea. Rose why didnt you that do that . Well, it didnt come from me laughter it came from it came from mike carol who worked with me on the brink. I mentioned it to wendy and she was very very negative about it. And then i backed off because i said there will be too much i dont want the touchy feely, i want to tell the story. And then mike carroll came to me again and so i suggested it to josh and joe. They said please convince wendy. As soon as i heard i knew. I told her wed need it and then she the amazing thing she is she refused top do any preparation, to compare notes, to talk about questions. She just showed up and did it, but, you know, shes very authentic, shes the real deal. Rose of course she is. But this is joe this is what we call until the business a natural. she was a natural. And its just it humanizes the film. Its it just and thats really rose if if you didnt like paulson, you meet wendy, there must be something there. Well its almost like twos have of a circle and then you get hank for a while. When i was shooting wendy said to hank now you go out. She would not let him watch and i remember the crew sitting there and going within the common theme this makes sense. And i remember you and i sitting there and we said shes a star. Yeah, i flew the first question this was going to be a major anchor in the film and for me all of my work is about theres a common theme, nothing appears nothing is really what it appears to be and theres all this very controversial stuff out in the either about hank and what he did and i just wanted to make this a human story to know what its like to deal with these crises. Rose in the end even though its high finance and even though its government all Decision Making has a Human Element to it. Absolutely. Rose humans make decisions and they make decisions based on the information they have. The biases they have, the advice they get, the whole range of things and often in the middle of a crisis youre seeing this now with the president and having to do with syria in the midst of a crisis you dont know the outcome. In no business decision do you have all the information like in a crisis you never do. So youre always, always trading off making imperfect decision and doing nothing and when people dont understand big ugly messy problems dont have neat perfect answers so the key i say and i had decision with crisis Decision Making before i went to washington the key is youve got to be prepared to change course and adjust if youre wrong. And you learn something new. Thats the key thing. So a lot of times people say to me hank, the reason you were as successful if you were successful was this you had all this experience on wall street and you understood Financial Markets. But people that really know me say the key ingredient i had was im decisive by nature and this was a case this was a time when you couldnt be afraid to make decisions you had to make decisions and when you didnt have the authorities you wanted. The reason why they look like were dealing on an ad hoc basis was because we did not have the right regulatory systemtor emergency authorities. Rose just on one content note. You say too big to fail is unacceptable . Of course. Rose but is it . Well, i would just simply say rose because if its unacceptable then rose well, i would say this. It was we did not have the authorities we needed. After doddfrank regulators now have emergency authorities to deal with any large failing Financial Institution so theyve got the tools. Now. But i will say to you even with these tools theres no although there niece bank thats too big to liquidate any bank of size is too big to lick wade date immediately. So i think the key will be how the tools are used and the proof will be in the putting. When we see the people sitting in the seat. And if i have one of the concerns i have are the actions we took are so ununpopular it will make it more difficult for those who are sitting there next to him to figure out how to use these tools to protect the American People. But hopefully although we will continue to have crises that they will be manageable like most of them have been in history. What we need to do is just avoid these massive dislocations and to do that you need first of all identify some of these excesses in bubbles before they become too big but secondly when the crisis manifests itself its going to take the political will and the courage to act with force as soon as possible. At least im comfortable that regulators now as a result of doddfrank had tools that we didnt had and i wish we had had because we would have enused them. Rose if it was ever enacted. Thats right. Rose Bloomberg Business week, this whole issue is devoted to this . To the crisis . And hank is our cover story but we take you back from september 15 15, fwagt which is the date that lehman collapsed all the way up until about two weeks ago. Rose and thats when it will be available on netflix, right . It will be available on netflix on september 16. This is hanks book which is is a fresh look back five years after with a new forward by barney frank but you have a new i have a prologue and ill say this. The publisher has take an step. The prologue is available for free online rose there you go. Thank you for joining us and well see you next time. 09 12 13 09 12 13 [captioning made possible by democracy now ] from pacifica, this is democracy now reports, look at the even the disclosures mr. Snowden has put forward, all of the stories that have been written, when what youre not reading about is the government actually , young these programs know, listening in on peoples phone calls or inappropriately reading peoples e