Henry Paulson Quotes

The Obama administration's plan is to have the Federal Reserve regulate banks that might pose a 'systemic risk' if they were to fail.

Bailing out every bank that fails makes the system riskier, not safer.

If a bank's too big so that it can't fail without hurting our economy, well then, it's too big.

The thought for a long time was that banks needed to be too controlled, too regulated to be turned over to the Wild West of the Net. Then the credit meltdown hit, and we saw just how reckless these so-called safe and regulated institutions were.

It is probably the case that some regulation of financing will make crises less likely, and I would say higher capital requirements are an almost fail-safe way to make banks safer. But there are a lot of other things that may not be doing that, and so we need to be careful about sort of, like, rushing to one conclusion or another.

Fannie Mae may have conformed to the rules but the rules didn’t conform to reality. A major bank or financial institution could meet every single regulatory requirement yet still be at the risk of collapse.

Compelling large banks to hold more capital reduces their risk of failure, but as the last financial crisis [the Meltdown of 2008] demonstrated, during a wide-spread panic, investors and lenders lose all faith in the values banks have assigned to their assets, and many mistrust the banks that claim to have enough capital.

Don't act like a bank unless you are a bank. That was a really big lesson learned from 2008.

The failure of one regional bank, assuming it is following a traditional model, will not threaten the entire system.

Large financial institutions in this country will always play a role that is essential to our economic growth. But they must only be permitted to grow and interconnect, throughout our economy, under careful oversight and with a mechanism for allowing those connections to be broken safely.

The banks, because of mismanagement, because of huge risk taking, are now in very vulnerable positions. We can expect that we're gonna have to do more to shore up the financial system. We also are gonna have to make sure that we set up financial regulations so that not only does this never happen again, but you start having some sort of - trust in how the credit markets work again.

Any bank that is too big to fail is too big. Period.

The only way to make sure no bank is too big to fail is to make sure no bank is too big.

For market discipline to constrain risk effectively, financial institutions must be allowed to fail. Under optimal financial regulatory and financial system infrastructures, such a failure would not threaten the overall system.

There is no evidence that more regulation makes things better. The most highly regulated industry in America is commercial banking, and that didn't save those institutions from making terrible decisions.

People think when you have a, quote, 'bank failure,' that that is the end of the bank. And it isn't necessarily.

I don't think anybody's too big to fail. I think the - I think if what you've got is sort of a large number of institutions who are going to fail, then that ends up affecting the system.

In the future, financial firms of any type whose failure would pose a systemic risk must accept especially close regulatory scrutiny of their risk-taking.

Bank failures are caused by depositors who don't deposit enough money to cover losses due to mismanagement.

Governments need to be authorized to provide 'open bank assistance.' The convolutions of Dodd-Frank aimed at 'avoiding' this tactic are ludicrous and will prove to be extremely costly to the system.

You shouldn't be trying to create a system where no bank fails, but you should be creating one that catches a bank and allows it to fail without impacting the financial markets.

What the American people don't understand is how Merrill Lynch or AIG or Lehman Brothers can reward people, and the entity fails. Not only do the shareholders lose, but the entities lose.

Our overriding goal in restructuring our financial architecture should be that taxpayers never again have to save a failing financial institution.

We think it would be safer if the Bank of England had responsibility for solvency regulation of UK-based banks, as well as having an overall duty to keep the system solvent. Otherwise, there could be dangerous delays if a banking crisis did hit.

A Fed loan to Lehman Brothers would not have prevented a bankruptcy.