don't be too -- a lapdog which was too playing golf on the weekends with hank paulson or something likeat. but you can't because hank has sort of a distended pinky so that wasn't an issue. >> jon: there's the inside dirt on the former treasury secretary. >> don't be too aggressive being a junkyard dog. don't make too many waves. don't make too much waves but don't appear too comfortable. behind all this, i first heard it i was like was this sounds reasonable. they were saying the best way to keep your head down, keep your budget coming and not rocking the boat too much which is the best path to getting a higher, better job in washington that's sort the way the town works jorchg it's go along or get along. it turns into a weird almost brazil like environment where you are basically -- you can't give homeowners money for their mortgage programs because that would create moral hazard while you are handing trillions to banks because they are too big to go after. this is the one of core ideological things we ran into. when it came to the banks anything and everything was on the table. saving

he was all hank paulson. then guess what? he got booted out of office and they brought in another guy. so, i'm like man, this is going to work with this guy, too. every new attorney that come n you have to sit down with them and meet them and tell them what this means to you and what you can do and what you can't do, see if they'll go with it. and, so, the new guy came in and i was like, i don't know if he's going to go with this, but let's try it anyway. so, this is where we met william brahas. i'll tell you a little about him, too, and his story. i'll wait for the advertisement. [video presentation] >> money for your gold. [video presentation continued] [speaker not understood]. >> all right. william brahas, 20 years old, how we caught him, too, he used a lot of the internet. he was all over youtube, facebook. his girlfriend was big in helping us locate him. she put it on her facebook. you know, i don't know if you guys know this, too, when you take a picture and you post it on your facebook, it gives a little longitude-lat

that's what hank paulson and secretary geithner began to call it.- the one division lost $858 million while he was there; correct? >> end of his first quarter on the job. it got worse after that, but they shut the unit and didn't report results separately. the losses were much greater, and ultimately, citi later that year gets a series of bailouts, $45 billion in taxpayer cash, taxpayer guarantees on hundreds of billions of the assets. it's among the biggest bailouts of the crisis here. david: isn't it fair to say, though, that most of the bad decisions, most of the decisions to buy into the other toxic incidents made before he arrived? >> on the alternative investments unit, that's definitely a fair statement. the question, i think, mr. lew will have a tough time responding to is, what did you understand about this when you went to work there? were you abelief yows to -- ooblivious to the risks? in which case we wonder if you can spot risks in the rest of the financial system, or were you aware of them and just didn't say anything? david: well, did

right after lehman failed hank paulson suddenly discovered he had a $50 billion kitty of money calledhe exchange stabilization fund that he could use to prevent the money funds from going under. it was there before. >> charlie: you also think they had to rescue a.i.g. >> i think they had to. it was on the other side of all... not all but a huge number of these awful c.d.s. credit default swap bets. if they had started failing one after another, this crisis which was big enough already would have just ballooned. >> charlie: is a.i.g. still getting special treatments? >> i think the last just ended. they pay back. if you'd have asked me in september of 2008 are we going to get all this money back from a.i.g., i would have said long long odds that we will. i think they just made the last payment very recently. >> charlie: the same thing about the auto companies? >> not quite. we're going to get back more than most people thought but the net losses in the tarp when all the accounting is for the troubled assets relief program which got used also for the auto companies, more than 100% of th

gordon brown what about mervyn king what about ben bernanke what about timothy geithner what about hank paulson what about the f.e.c. f.s.a. what about the f.c.c. what about the commodities futures trading commission what about all these other regulatory bodies that oversee these. all have authority to put these guys out of business what about them why didn't they do it mark carney the incoming bank of england governor he's brought in to to basically whitewash everything for a few months before the bond pocalypse hits and everything starts to stink really badly again so he's just a whitewash he's just brought into whitewash she knows mark carney is implicit in record tearing and financial fraud he mark carney is a crook is coming in here to practice this is racketeering but he's going to whitewash the for to give these guys a breathing room ok so back to the story here because we talked about the bond pocalypse and all the bonds are based on these libel rates all these interest rates watts are based on live or rates every single financial contract in the world is based on these financial these

gordon brown what about mervyn king what about ben bernanke what about timothy geithner what about hank paulson what about the f.e.c. f.s.a. what about the f.c.c. what about the commodities futures trading commission what about all these other regulatory bodies that oversee these. all have authority to put these guys out of business what about them why didn't they do it whenever mark carney the incoming bank of england governor he's brought in to to basically whitewash everything for a few months before the bond pocalypse hits and everything starts to stink really badly again so he's just a whitewash he's just brought into why washy knows mark carney is implicit in record tearing and financial fraud he mark carney is a crook is coming in here to practice just is racketeering but he's going to whitewash the for to give these guys a breathing room ok so back to the story here because we talked about the bond pocalypse and all the bonds are based on these libel rates all these interest rates watts are based on live or rates every single financial contract in the world is based on these financial t

brown what about mervyn king what about ben bernanke you what about timothy geithner what about hank paulson what about the f.e.c. f.s.a. what about the f.c.c. what about the commodities futures trading commission what about all these other regulatory bodies that oversee these. all have authority to put these guys out of business what about them why didn't they do it what about mark carney the incoming bank of england governor he's brought in to to basically whitewash everything for a few months before the bond pocalypse hits and everything starts to stink really badly again so he's just a whitewash he's just brought into why washy knows mark carney is implicit in record tearing and financial fraud he mark carney is a crook is coming in here to practices is racketeering but he's going to whitewash the for to give these guys a breathing room ok so back to the story here because we talked about the bond pocalypse and all the bonds are based on these libel rates all these interest rates watts are based on live or raise every single financial contract in the world is based on these financial the

that is why in the early days smart people like hank paulson and then bernanke said this is not that big and will be contained. it was only this of prime mortgages they would be right but it was a lot. >> i am at page 18 in your book. [laughter] i figure i will get the answer eventually but it is the troubled assets with bear stearns 30 billion had to be extracted to make the deal worked within the bad assets were absorbed by the government but i don't hear any more discussion. where are they? are they still nonperforming? how big is that? >> first of all, the government did not acquire that many bad assets the huge volume by the federal reserve of mortgage backed securities and the federal reserve was somewhat picky about what it would buy basically only buying fannie for the guaranteed paper not all that was fabulous but in the and freddie had the best so that was the criteria. [laughter] but that is what the fed bought. since then, those assets have appreciated substantially. by low, so high that is what the fed and the treasury did with aig. the fed is still holding the envious b

brown what about mervyn king what about ben bernanke you what about timothy geithner what about hank paulson what about the f.e.c. f.s.a. what about the f.c.c. what about the commodities futures trading commission what about all these other regulatory bodies that oversee these. all have authority to put these guys out of business what about them why didn't they do it whenever mark carney the incoming bank of england governor he's brought in to to basically whitewash everything for a few months before the bond pocalypse hits and everything starts to stink really badly again so it's just a whitewash he just brought into why washy knows mark carney is implicit in racketeering and financial fraud he mark carney is a crook is coming in here to practice is is racketeering but he's going to whitewash the for to give these guys a breathing room ok so back to the story here because we talked about the bond pocalypse and all of the bonds are based on these libel rates all these interest rates watts are based on live or rates every single financial contract in the world is based on these financial thes

gordon brown what about mervyn king what about ben bernanke what about timothy geithner what about hank paulson what about the f.e.c. f.s.a. what about the f.c.c. what about the commodities futures trading commission what about all these other regulatory bodies that oversee these. all have authority to put these guys out of business what about them why didn't they do it whenever mark carney the incoming bank of england governor he's brought in to basically whitewash everything for a few months before the bond pocalypse hits and everything starts to stink really badly again so he's just a whitewash he's just brought into white washing knows mark carney is implicit in record tearing and financial fraud he mark carney is a crook is coming in here to practice is is racketeering but he's going to whitewash the for to give these guys a breathing room ok so back to the story here because we talked about the bond pocalypse and all the bonds are based on these libel rates all these interest rates watts are based on live or rates every single financial contract in the world is based on these financial th

gordon brown what about mervyn king what about ben bernanke what about timothy geithner what about hank paulson what about the f.e.c. f.s.a. what about the f.c.c. what about the commodities futures trading commission what about all these other regulatory bodies that oversee these. all have authority to put these guys out of business what about them why didn't they do it what about mark carney the incoming bank of england governor he's brought in to basically whitewash everything for a few months before the bond pocalypse hits and everything starts to stink really badly again so he's just a whitewash he's just brought into white washing knows mark carney is implicit in record tearing and financial fraud he mark carney is a crook is coming in here to practice this is racketeering but he's going to whitewash the for to give these guys a breathing room ok so back to the story here because we talked about the bond populous and all the bonds are based on these libel rates all these interest rates watts are based on live or raise every single financial contract in the world is based on these financial

i remember hank paulson told president bush four times he didn't want the job as treasury secretary backd guess what, you know, when the president tells you, please -- >> or asks you, yeah. >> it's telling, we need you. you take the job, and i'll tell you, that's what people say, geithner comes back to government. if you ask me to lay odds on this, i don't know. the guy's been in government his entire life, never been in the private sector,ments to make a -- wants to make a few bucks, a decent advance, over a million dollars; right? if greg smith gets a million for the goldman sachs book, he can get a million dollars for his. talking about treasury -- >> during dramatic times. >> the financial crisis. you can agree or disagree with the performance. i think -- i don't think he was good on the economy, but he was in the main jobs as president of the new york fed, which is the main regulator of wall street in the financial crisis and in the post financial crisis years, the first four years of the obama presidency, these are amazing times. that book should be an interesting read, and, i'll t

i have talked to hank paulson about it, i know why he thought about it the way he did. i'm not here to criticize him. i know what it is like to make those decisions. i they they are demargin, those guys were prisoners of the system in which it was so interlocked and intertwined that unless they did the things they did it would have been much worse for middle america because it would have brought down the whole economy with them. >> rose: to make a headline here, once again, the sequester, four days now, $8-- $85 billion, you believe that there is no way that they can avoid the disaster because nobody is willing to negotiate at this stage. >> i believe there's no way for us to avoid the sequester. a disaster will unfold over time, we still have a chance to avoid that. but there is no sign anybody is ready to do this. >> rose: thank you, steve, steve rattner, back in a moment. stay with us. 50 years of feminism is investigated by a new documentary called makers: women who make america. it covers a number of landmarks both positive and negative in the fight for equality. t

. >> rose: you are the guy that went to hank paulson, some others did too. >> yeah. >> rose: and said don't bail me out, i don't need. >> i was worried it would be impose and the whole industry through aig. it was getting there. and the insurance industry, i wanted them to know that aig was different. certainly from us. and we didn't do-- in the financial products business that aig had where they rented out their credit rating, that's what they z that is the most precious asset that we have. and candidly, i am just being honest with you, it never even occurred to me to do it i look back on that and i asked myself was it because i wasn't sufficiently sophisticated to see it as an alternative that i rejected. or was it because i think about my business in a certain way that it didn't even occur to me. it never occurred to me to do it and when i saw what they had done it was eye-popping. eye-popping. >> rose: eye-popping. >> yeah. >> rose: because you it never imagined it. >> couldn't imagine that you would-- i mean aig-- . >> rose: why do you think they did it? >> you know, i think that