A list of Henry Paulson's mistakes over the past year or so is here. Taken at face value Paulson's prognostications are scary as hell (August 1, 2007: 'The market has focused on this. There's a wake-up call, and there's an adjustment to this repricing of risk, but I see the underlying economy as being very healthy.'). My take on the piece and Paulson's miskakes is this:

The guy is from Goldman. He's taught himself to bullshit clients when his recommendations go sour and get more money from them to throw at something else. It's in his genes as it is with all of us who have ever been brokers. He was top dog at Goldman and he didn't get there without conning the shit out of multi millionaires and getting new blood as existing clients got sick of him and his firm. Pretending we know something that is impossible to know is what we brokers do. The reason the market did what it did today? Nobody knows. Nobody.

And while you're there you might want to check this out too.....