How Paulson Gave Hedge Funds Advance Word of Fannie Rescue

[cory777]

Source: Bloomberg

Nov. 29 (Bloomberg) -- Treasury Secretary Henry Paulson stepped off the elevator into the Third Avenue offices of hedge fund Eton Park Capital Management LP in Manhattan. It was July 21, 2008, and market fears were mounting. Four months earlier, Bear Stearns Cos. had sold itself for just $10 a share to JPMorgan Chase & Co.

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On the morning of July 21, before the Eton Park meeting, Paulson had spoken to New York Times reporters and editors, according to his Treasury Department schedule. A Times article the next day said the Federal Reserve and the Office of the Comptroller of the Currency were inspecting Fannie and Freddie's books and cited Paulson as saying he expected their examination would give a signal of confidence to the markets.

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At the Eton Park meeting, he sent a different message, according to a fund manager who attended. Over sandwiches and pasta salad, he delivered that information to a group of men capable of profiting from any disclosure.

Around the conference room table were a dozen or so hedge- fund managers and other Wall Street executives -- at least five of them alumni of Goldman Sachs Group Inc., of which Paulson was chief executive officer and chairman from 1999 to 2006. In addition to Eton Park founder Eric Mindich, they included such boldface names as Lone Pine Capital LLC founder Stephen Mandel, Dinakar Singh of TPG-Axon Capital Management LP and Daniel Och of Och-Ziff Capital Management Group LLC.

Read more: http://news.businessweek.com/article.asp?documentKey=1376-LVDZC507SXKX01-53FDT6STR4PRVU9B7CRTDL62J0

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[Autumn]

1. Paulson should be fired and investigated

now.

[irisblue]

2. what the....?gonna go read the article...

now.

[go west young man]

3. Damn finally a bit of truth. Now let's see if we can get some justice for it.

[russspeakeasy]

4. ..and when does this piece of shit go to jail ?

[defendandprotect]

5. Paulson is just one more of Obama's Wall Street team -- !!

:puke:

[irisblue]

7. not obamas' team

paulson was bushs' sec of treasury. his term of office ended when obama was sworn in. obama has done some wrong things, but not THIS wrong thing....do know your facts before you bash obama.

[defendandprotect]

8. My apologies -- Geithner, of course --- Summers and many others, however ... !!

Reappointing Bernanke, as well -- who also worked closely with Paulson --

rather than auditing the FED.

[No Elephants]

6. Vile POS needs to be arrested for violating securities laws.