Outside the Capitol, the deepening recession could be seen in one historic statistic after another. For example, new housing starts dropped to 50-year lows. Hundreds of thousands jobs lost in just a month. The stock market sunk again, taking retirement savings with it. There is no end in sight.
Joining me now to talk about what we learned this week is Joe Nocera. He's an award-winning business columnist for the NEW YORK TIMES. Last year, he was a finalist for the Pulitzer Prize in commentary. His latest book, GOOD GUYS AND BAD GUYS, is a collection of his writing covering the saints and scoundrels of American business.
DEBORAH AMOS: Welcome to the Journal.
JOE NOCERA: Thanks for having me.
DEBORAH AMOS: Henry Paulson told us this week that we've turned a corner, that the markets are stabilized. But yet we saw banks losing their value. I read at Citicorp they've even taken the stock ticker off the televisions in the office because the news is so bad. So if Paulson's convinced we're stabilizing, is the bailout working?
JOE NOCERA: In a word, no. The bailout was intended to restore capital in the major banks. And one of the reasons they gave it to all nine banks that they gave it to was they wanted to try and disguise which banks were troubled and which weren't, so that people wouldn't lose confidence in particular institutions. But everybody knew that Citicorp was in the worst trouble. And events over the last few weeks have just kind of worsened its condition. And now the market really doesn't believe that the $25 billion they got from the federal government is going to be enough. And in fact Paulson's statement was really premature. And the sad part is, to me, that his actions this week have really kind of signaled that he's shutting down between now and January 20th. It's like, "I'm done. I'm out of here."
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