KEY POINTS:
On Wall Street, they still call him Hank The Hammer but US Treasury Secretary Henry Paulson has refrained from striking blows in attempts to solve America's worsening financial problems.
Rather, the 1.85m former Ivy League American football champ has charted an unusually quiet path of diplomacy, leaving it largely up to others to speak out in an effort to ease panic and restore order to global markets.
"My view from the day I came here was not to talk unless I had something to say," he said after a long meeting with Ben Bernanke, chairman of the Federal Reserve, and Christopher Dodd, chairman of the US Senate banking committee. The trio met last week to discuss what, if anything, they should do to remedy the deepening credit crisis.
After the meeting, the Fed pumped billions of dollars into the market to shore up liquidity and Paulson made some very general utterances about the underlying strength of the US economy and how he thought everything would be all right in the end.
Other than that, he has remained tight lipped - at least in public.
Behind the scenes, he is working feverishly, calling Wall Street contacts in a round-the-clock effort to crack the credit crunch. He roped in Robert Steel, Treasury undersecretary for domestic finance and a fellow Goldman Sachs alumnus, to help him encourage banks to borrow from the Fed to get the markets moving again.
They combed Wall Street for answers and recruited the pointiest heads in the Treasury's brains trust in an effort to determine what will get investors back into the market.
Paulson is a Christian Scientist who neither drinks nor smokes but has the booming, gravelly tones of a man who smokes 20 Capstan Full Strength and drinks a bottle of scotch a day. He is used to his ample vocal abilities getting results and fast. But on many important issues in the financial crisis, he must defer to Bernanke, which is why he must work on restoring market confidence from the privacy of his own office.
But his methods seem to be working. Making billions of dollars of credit available through the Fed is enough, some economists think, to restore confidence among banks.
The fact that a Wall Street man of Paulson's stature is taking the time to call around to offer double reassurance is the icing on the cake.
Paulson has borrowed a trick from old JP Morgan himself, who worked equally feverishly to solve the 1907 financial crisis, calling everyone he knew to say he had ultimate confidence in the power of the market to heal itself. Morgan went down to Wall Street and invested his own cash to show his faith. Paulson can't go quite that far - Treasury rules on personal investments are explicit on that - but the most influential people have seen enough to know he would if he could.
When, in July 2006, Paulson reluctantly accepted the invitation to high political office from George Bush, he was chief executive of Goldman Sachs and, as such, the most successful investment banker on Wall Street. He had led the bluest of blue-chip banks from being a secretive and arcane partnership to become a modern, yet still secretive, public company.
He had driven profits to record heights by massaging contacts among the world's wealthiest people and richest corporations.
But above all, he increased the level of risk Goldman was prepared to take in the pursuit of profit and to do so allowed the bank to accrue many tens of billions of dollars more in debt than ever before. Sounds familiar?
This highly leveraged pursuit of the riskiest deals, often backed by billions of dollars of the firm's own money, was Paulson's trademark at Goldman and is precisely the type of strategy that has led to a crisis of confidence in today's markets - which is why Goldman has been particularly hard hit. It has admitted to big problems at some of its hedge funds, while analysts have hinted at a big dent in leveraged-buyout-related businesses.
This is perhaps another reason for Paulson's reluctance to speak out, especially in favour of regulation to thwart a future run in the debt and mortgage markets. It was all too recently that the bank he ran was dabbling in them with very profitable results. Paulson's net worth is estimated to be about US$800 million, with just under half of his fortune amassed in lucrative shares in Goldman Sachs awarded after the bank's 1999 flotation.
This is not the first time Paulson has worked the phones to get a difficult job done. He was on the board of the New York Stock Exchange when the issue arose of excessive pay and bonuses made to chief executive Dick Grasso. Paulson waged a blistering PR attack against Grasso that soon led to his ousting and a flurry of as yet unresolved legal battles.
John Thain, a former Goldman treasurer and close friend of Paulson, was ushered in as Grasso's replacement. Next the NYSE went public via a merger with Archipelago, an electronic share trading firm. Goldman not only owned 15 per cent of Archipelago but also advised on the merger and subsequent flotation.
These are the results Paulson was used to in the private sector, all without raising his head above the parapet. He has a long history of emerging unscathed from the most unpalatable situations, even when he was a kid.
One summer's evening in 1969, a 23-year-old Paulson scaled a fence in West Lafayette, Indiana and plunged into the local swimming baths. The police arrived and he was arrested for trespassing. After a short period of negotiation, however, the charges were dropped.
Not long after, and fresh out of Dartmouth College and Harvard Business School, he was an aide to John Ehrlichman, Richard Nixon's White House chief of staff. Not only was he was well connected enough to get the job but well connected enough to resign in the thick of the Watergate scandal without ever getting caught up in the fallout.
He went straight to Goldman back home in Illinois, not far from his parents' home in Barrington, where his father ran a sales training business. From there, his skills as a negotiator and salesman led him on a speedy rise.
Much is made of his commitment to the environment, chiefly because his stance in favour of alternative energy jarred with traditional conservative policy. He has cajoled and coerced Bush into agreeing with him in principle on many environmental issues that were previously anathema to conservatives. He loves birds and has a fondness for snakes.
His wife, Wendy, says she and the children, Amanda and Merritt, can tell when he has spent too long with the reptiles because he gets "that snake look in his eyes".
Their modest home near Barrington is a veritable zoo, with racoons, flying squirrels, alligators, mice, birds, turtles, lizards and a tarantula.
As the markets face another week of turmoil, traders pine for the sort of comfort Alan Greenspan used to provide at such times but Bernanke has fallen short of filling his shoes. In his stead, the Treasury will continue to wield 'The Hammer' in private and hope to knock some sense back into the market.
BIG HITTER
* Henry 'Hank The Hammer' Paulson Jr
* Born: 1946, Barrington, Illinois
* Education: BA, English literature, Dartmouth; MBA, Harvard
* Career: Formerly chairman and CEO of Goldman Sachs. Pentagon aide 1970-72, assistant to John Ehrlichman in Nixon White House 1972-73 Now US Treasury Secretary
* Homes: New York City and Barrington, Illinois
* Hobbies: Bird-watching in Central Park, conservation
-Observer
