>> rose: welcome to the program. september 15, the 2013, marks five years after the financial crisis and the fall of lehman brothers. there's documentary called "hank." we'll talk to the subject of that documentary, paulson, former secretary of the treasury. >> don't get this wrong, because this was a miserable experience for me and for the american people who've 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: 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 bank lehman brothers on september 15,

2008. soon, several of wall street's most venerated institutions were teetering on the edge of insolvency. the government's response was unpresidented 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." here's a look at the trailer. >> by anyone's measure, we are living in extraordinary times. >> prices are at an all-time high. >> my goal has not been to go to washington. >> i'm pleased to announcely nominate henry paulson to be the secretary of the treasury. >> i didn't 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. we're 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 they're 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. it's important that there be a

historical record, so we don't 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, it's great to be back. >> rose: does it seem like a long time ago or yesterday? >> i'll 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 can't go through a process like that, an experience like that, without being changed. everything we go through that's difficult causes us to grow. we find we're able to do things we didn't think we would be able to do. so it makes a difference. and when you go through something as consequential as that it -- it's a life-changing experience. >> how so? it was the defining professional moment of your life? >> right. well, i have have to say charlie-- and don't get this wrong because this was a miserable experience for me and for the american people who've 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: that's 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 i'm -- 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 that's 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 didn't 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 there's a natural tendency for any president coming in to respond to the base and say let's throw out what the other guys did, let's do it better." but they made the decision which couldn't 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 weren't able to convince enough people in the country that you were not favoring the big banks over main street. >> charlie, that's a nice way of

putting it. you're a friend. that's an understatement. i wasn't able to make that sale. i just wasn't 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. >> that's right. former c.e.o. of goldman sachs. but i'd left goldman sachs. i'd 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 don't see all the different pipes and it wasn't 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 don't think they understood. i was looking at it and saying "boy, another big institution goes and there's so much concentration that's all she wrote. how we will ever start these banks up again if they close? what will happen?" but the american people didn't 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: that's 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. it's 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 i'm good at that and thinking of them as clients. but speaking publicly it's something that doesn't 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 couldn't 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 didn't want to have to explain how serious it was to the american people. and he said "well, you've got your market and we've 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 didn't 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 wasn't wanting to talk about what would happen if the banks closed down and couldn't open up or what happened when industrial companies couldn't raise financing because i thought that would cause the panic to move there. and even after we'd taken the step wes'd taken i still lived in fear that i wouldn't have the last the for the tarp and as big bank would go down and that would be all show wrote. so i wasn't 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 we'd 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 here's an institution with three trillion in liabilities, $500 billion in deposits outside the united states that don't enjoy the deposit insurance in the united states of america and if if that institution had gone down, i don't 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 five-alarm fire. we had -- we're 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 -- we're going down. so this wasn't because of lehman they had their own problems. merrill lynch was on the brink. so afterwards -- after lehman had failed, i couldn't stand up, at least in my judgment, to say "hey, guess what? the united states of america, we tried and we didn't have -- the fed didn't, treasury couldn't guarantee liabilities, capital alone wouldn't 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 there's 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: what's important about this conversation in this film is it's five years after. there's new information. these three big questions are out there. what would have happened? let's assume you could have if you argue there's 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, here's 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 there's a buyer for lehman than the market will turn immediately to may recall and if there's 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 wasn't the cause, lehman was the symptom. i tend to use my colleague's popcorn analogy, so then what i say very simply now -- i didn't 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, there's no one there. we didn't 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 that's what we learned up cos and person with bear stearns. but the market wasn't 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 you'll 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 wouldn't let them. if you look at it right now i'm 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 that's ever been done before like this, we didn't deal with -- we didn't 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 don't want this to sound like an excuse because i -- of course the answer is on the one hand of course yes but i don't 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. that's what a bubble is, right? and there will always be a couple people that said, yup, i saw it, look. and -- but they won't 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 don't know because i didn't see '98, i didn't see '94. with 20/20 hindsight it will be obvious. we missed housing not because we didn't 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 -- i'm 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 don't think there's 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 i'm 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 i'm concerned is always flawed government policies. which lead to excesses, ultimately bubbles and then they manifest themselves in the financial system no matter how it's 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. that's not a problem. it's only a problem if we don't go and clean up the messes and address the government policies. >> rose: i think the point is at fannie mae and freddie mac? >> i'm going -- there's no doubt. so they were ground zero of the

problem. they were the vortex of the problem and to me there's nothing we did that was more effective in preventing a meltdown and keeping the housing problem from being much worse. just think, if there hadn't been housing finance what would have happened? but they're 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." >> it's one thing to say that, it's 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, that's 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 weren't trying to blow up their institutions. do you believe what i do that this was a hundred-year storm that these excesses had been building up for years and years in the system we were dealing with something the likes of which we've never seen before, the likes our country hadn't seen and i'll tell you if i think we hadn't taken the actions we'd 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. >> there's no doubt that is a contributing factor, stock? no doubt in my mind that's 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 they're angry at me and they're 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 didn't 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 didn't want the economy xhi to collapse, i didn't want them lose their jobs. but so i understand that and i just -- as i said, i thought it was a colossal lack of self-awareness, 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 don't want right now-- and part of the reason why i'm doing this is if people look at this and say well, is this the bankers, it was just the bonuses then we won't fix our problems. and we will be back here again. >> rose: we'll 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. >> it's 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 self-awareness 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. i'm hear what former treasury secretary hank paulson. joining us are josh tier ring

gal editor of bloomberg business week's and the film's 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. >> i've tried to figure out what the right medium presentation is of any kind of story. and this there's been plenty written about the financial crisis but in my conversations with folks including-- i don't 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 haven't 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, that's very interesting and i lead hank's book and met hank a couple years ago at a panel discussion about the crisis. and i thought that's interesting. i don't 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 you've said so far hasn't 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) >> that's an understatement.

>> rose: what did you think? >> well, i thought basically there's 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 don't want a replay. we want to clean up our messes and make sure -- >> rose: understand the lessons and what worked and didn't work. >> that's for sure. >> rose: i just quarreled with you about the notion of what tim said to you. i've had one person after another-- not all of them-- come on the program and say "you were lucky that bernanke and paulson were there.". it's the quality of like warren

buffett that have said that time after time after time. >> and i think there's a giant disconnect between the people who understand the economy and understand the banking system and the people who don't. and the people who don't 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 we've agreed on is it's 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 let's -- we've had five years, there's time, let's 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 didn't 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 it's 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 -- i'd seen many of joe's films and i thought they were great. i didn't know joe at all but as it turned out this is not new territory to you. >> when he will, i was physician-assisted 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 couldn't resist.

but for me the amazing journey of making this project is i entered this project with a bit of skepticism. i'm one of those three hundred million people-- despite what i think above-average financial literacy compared to non-financial people, amongst my friends who are not in the financial industry i think i'm -- i have some basic good knowledge-- but, you know, i'm -- i'm one of those people who probably i guess being the social issues left-leaning 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. it's 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 didn't 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 can't prove a counterfactual." and i remember thinking what's a counterfactual? you're 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 didn't go that far. they just went and said they did it all, i'm suffering and you've bailed out wall street. wall street made mistakes but the regulatory system was screwed up, we didn't have the powers we needed. regulators made a lot of mistakes, congress made mistakes, the rating agencies made mistakes, investors made mistakes and i'm not defending the banks, that's the last thing

i want to do, but if all we say is it's all about the banks and we just focus on the banks, banks, banks, we'll be back here again. >> rose: everybody was complicit one way or the other. >> yes. >> rose: did you learn anything you didn't 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 don't 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, it's 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 country's 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 i'm most proud of is i think it takes some very complex material through hank's 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 don't 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 you're going to be doing and there's dialogue and a voice we don't 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 they're -- hank is talking directly to them. >> rose: did you feel like some part of the story you didn't tell, couldn't tell, was impossible to tell? >> i think we left a few crises out. there were a number of things he

dealt with in that six-month 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 i'm saying the majority, not everybody responded in a way that was working in the interest of the public? we're trying to make the right decision and we're 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 they're 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 i'm 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 don't 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. i'd 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 didn't 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 didn't 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 hank's story. >> rose: what is hank's story? so we're seeing hank's story? >> this is hank's 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 hank's story, the idea of putting wendy in the actually came from hank and i thought that was a brilliant idea. >> rose: why didn't you that do that? >> well, it didn't 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 don't 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 we'd 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, she's very authentic, she's 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 it's just -- it humanizes the film. it's -- it just -- and that's really -- >> rose: if if you didn't like paulson, you meet wendy, there must be something there. >> well it's 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 she's 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 --

there's a common theme, nothing appears -- nothing is really what it appears to be and there's 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 it's like to deal with these crises. >> rose: in the end even though it's high finance and even though it's 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 you're seeing this now with the president and having to do with syria in the midst of a crisis you don't know the outcome. >> in no business decision do you have all the information like -- in a crisis you never do. so you're always, always trading off making imperfect decision

and doing nothing and when people don't understand big ugly messy problems don't 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 you've got to be prepared to change course and adjust if you're wrong. and you learn something new. that's 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 i'm decisive by nature and this was a case-- this was a time when you couldn't be afraid to make decisions-- you had to make decisions and when you didn't have the authorities you wanted. the reason why they look like

we're 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 it's unacceptable then -- >> rose: well, i would say this. it was we did not have the authorities we needed. after dodd-frank regulators now have emergency authorities to deal with any large failing financial institution so they've got the tools. now. but i will say to you even with these tools there's no -- although there niece bank that's 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 it's going to take the political will

and the courage to act with force as soon as possible. at least i'm comfortable that regulators now as a result of dodd-frank had tools that we didn't had and i wish we had had because we would have enused them. >> rose: if it was ever enacted. >> that's 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 that's when it will be available on netflix, right? >> it will be available on netflix on september 16. >> this is hank's 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 i'll 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 we'll 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 you're not reading about is the government actually , young these programs know, listening in on people's phone calls or inappropriately reading people's e-