Former Treasury Secretary Henry Paulson said he would invest in U.S. government securities before other sovereign debt even though the nation’s political process isn’t working at a “AAA level.”
“Our political process, our government, hasn’t been working at a AAA level,” Paulson, 65, said today at Dartmouth College in Hanover, New Hampshire. “But despite that, I would take U.S. Treasuries over other sovereign debt, other AAA sovereign debt, any day of the week. That’s not to say we don’t have important issues to deal with in this country.”
Paulson, 65, was Treasury secretary from 2006 to 2009 under President George W. Bush at the time of the Lehman Brothers Holdings Inc. bankruptcy and financial crisis in 2008. He was chairman and chief executive officer of Goldman Sachs Group Inc. before joining the Bush administration.
The biggest problem now in global financial markets are “structural issues in the European Union,” Paulson said.
“I’m talking about the large fiscal deficits in a number of nations there and structural issues in the EU itself,” he said. “The leaders are working on this and it’s going to take some time to resolve these problems.”
Paulson said the global situation is “very, very different” than it was in 2008.
“Our issue is growth. We need growth. We need jobs,” Paulson said. “The full extent of the housing bubble was a surprise to the markets in 2008. It really was. Today, the risks are, I think, pretty obvious. And I think people largely understand them and are focused on them.”
Paulson, a 1968 Dartmouth graduate, was speaking at the college’s “Leading Voices in Politics and Policy” lecture series.
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