I think there's probably problems with this bill. George, I think every government is going to -- is going to -- is going to bail out certain types of entities if they fail, if they threaten the economy. You shouldn't announce it. You shouldn't say it. You shouldn't set those parameters so it's clear they're going -- it's like a ransom policy. Every government has a ransom policy, but you don't announce it up front and say, "Here's our ransom fund," because that encourages bad behavior.
I don't think this bill totally addresses some of the complaints. I think it goes at least in some direction, however, Jake. And I'll tell you, at 10 o'clock on Friday morning, I thought the odds were about 60 percent or 70 percent this bill would pass. I don't think the politics are with the Republicans. This is not like health care. By 11 o'clock on Saturday morning, the odds went up to about 90 percent, because when the SEC brought that fraud suit against Goldman, I think that was the clincher.
TAPPER: Let's talk about the Goldman suit. First of all, I think we need to explain a little bit about it. The basic point is that the Securities and Exchange Commission has brought a suit against Goldman Sachs, and, Al, walk us through exactly -- there was -- there -- there is a guy -- there is a guy named Fabrice Tourre, right? Well, first of all, we start off...
HUNT: He's 28 years old.
TAPPER: We start off with a guy named John Paulson. He wants to bet against the housing industry in 2007. So...
HUNT: Right, and he put together -- Mr. Paulson had Goldman put together this -- this entity. It was called Abacus, I believe, which had a bunch of exotic instruments in them, which Mr. Paulson was convinced were going to go south and he could make a lot of money by betting against them. And Mr. Tourre, this 28-year-old Goldman trader, was involved in putting this together.
They then sold them to other Goldman clients, so the Goldman clients are betting that they were going to go up, and the Goldman clients lost $1 billion...
TAPPER: Right. And if I could interject for one second, Mr. Tourre thought that it was going to go down, as well. And, in fact, there's a memo -- apparently -- and there was this memo from him, sent in 2007, saying, "More and more leverage in the system. The whole building is about to collapse any time now. Only potential survivor, the Fabulous Fab," referring to himself, standing in the middle of all these complex, highly leveraged, exotic trades he created without necessarily understanding all the implications of these monstrosities. So he, it looks like, knew this was going to fail.
HUNT: This stuff is surreal. And these -- this is the derivative issue that is at the center, I think more than anything else, of this -- of this bill up there.
And the question is not do you outlaw things. The question is transparency and do you clear them on clearing -- trading organs. And I think that becomes very difficult for most of the public to understand, but what the public does understand was what happened before was a bunch of rip-offs.
BRAZILE: But you know what the public will always understand, is that they were misled and that Goldman misled some of the investors. And, you know, while they're pushing these exotic instruments, they're also betting against these instruments. So you have a lot of unhappy investors.