Charles Calomiris is angry. Hank Paulson's plan to save the economy? "Truly idiotic," says Calomiris, who is the Henry Kaufman Professor of Financial Institutions at Columbia University's business school. "This whole thing has been complete nonsense. We did it in the 1930s ten times better than this. This isn't complicated."

Deal Journal caught up with Calomiris late Monday to talk over the state of the financial world. Calomiris has long advised governments, banks, and private investors on financial crises. And while he spoke...