Bush: 'Wall Street got drunk and now it's got a hangover'

Secretly recorded, President Bush points the finger of blame for the credit crunch

Drying out is a subject on which President George Bush has personal insights. And when he used the metaphor of a drunk sobering up after a bender to describe America's economic travails, people sat up and listened.

"Wall Street got drunk," Mr Bush told a private gathering in Texas as he sought to explain why the world's biggest and most complex economy was teetering on the brink of recession.

When speaking in public, the President, a Harvard MBA, usually prefers euphemisms to refer to the millions of people who are hurting and losing their homes. "Challenges in the housing and financial markets," is a favourite one. But speaking to a closed-door Republican fund-raiser in Houston last week his explanation was much blunter.

"There's no question about it," Mr Bush said. "Wall Street got drunk, that's one of the reasons I asked you to turn off the TV cameras. It got drunk and now it's got a hangover. The question is how long will it sober up and not try to do all these fancy financial instruments."

Discredited as President and so unpopular that even John McCain shuns him, Mr Bush still has the Midas touch when it comes to fundraising. Provided the doors are closed to the media, he is the most favoured guest of Republican politicians trying to stump up cash.

Mr Bush had asked his audience in Texas to switch off their cameras, saying he was worried about YouTube. But his comments were recorded on a mobile phone camera and passed to ABC television.

The video also contained a scoop that the Bushes will not be living full time at the President's beloved Crawford ranch, and are busy shopping for a house in Dallas. They may even settle in the wealthy suburb of South Fork, the setting for Dallas, the 1970s television hit. It should be a buyers' market, but the President complained that that was not the case. "And then we got a housing issue," he said, "not in Houston – evidently not in Dallas, because Laura's over there trying to buy a house today. I like Crawford. Unfortunately, after eight years of asking her to sacrifice, I am no longer the decision-maker. She'll be deciding." Mr Bush said he had offered his wife some guidance: "I said: 'Honey, we've been on government pay now for 14 years. Go slow.' "

But it was the comments about Wall Street's bender that caught people's attention. Tony Fratto, the deputy White House press secretary, played it straight. "The President has made this point before," he said. "What the President is referring to is the fact that the markets were using very complex financial instruments that had grown up over the years, and when confronted with the shock of this housing downturn, they did not fully understand what the consequences were going to be."

Mr Bush's own battles with the bottle are well chronicled. The revelation – just four days before the 2000 election – that he had been arrested in 1976 while driving under the influence almost lost him the presidency.

Mr Bush famously quit alcohol the day after his 40th birthday – 6 July 1986 – which he had spent getting blind drunk. He was off to Washington to work for his father and as Laura Bush recalled: "He knew he couldn't move there and work on his dad's presidential campaign and keep drinking like that."