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Consider that Fannie and Freddie were allowed not to provide detailed financials to congress for several years in a row preceding the 2008 housing collapse. It

Consider that Fannie and Freddie were allowed not to provide detailed financials to congress for several years in a row preceding the 2008 housing collapse. It's not a matter of "oh wow, a major government fudges numbers", it's "how many major ways in which my government fudges numbers might I not be aware of?"

JumpCrisscross 8y ago
> Fannie and Freddie were allowed not to submit financials to markets for several years in a row preceding the 2008 housing collapse Source? I’m searching and can’t find one. I also remember reading Fannie & Freddie prospectuses from that time. Each contained extensive financial disclosures.
- resters 8y ago
  Information was omitted: https://www.nytimes.com/2016/09/03/business/dealbook/why-no-punishment-for-financial-executives-fannie-mae-is-case-study.html https://www.nytimes.com/2016/09/03/business/dealbook/why-no-...
  - digitaltrees 8y ago
    This article doesn’t support your original claim at all.
    - cryptonector 8y ago
      > This article doesn’t support your original claim at all. Could Fannie’s officers really have been accurately disclosing the risks the firm was taking shortly before its sudden collapse? It is here where the case got complicated. While he was chief executive, Mr. Mudd said that subprime mortgages accounted for about 2 percent or less of the mortgages Fannie Mae was insuring. The commission’s case largely rested on the fact that this percentage did not include the insurer’s longstanding programs for low-credit score borrowers, Expanded Approval and MyCommunityMortgage. The theory about the Alt-A loan disclosures was also not that Fannie had not disclosed that it was in the business. It classified a number of its loans as Alt-A, and told investors as much. But it did not disclose that it had instructed lenders not to classify certain other loans as Alt-A, even though they were also supported by low documentation. ... The 2008 crisis definitely involved some sort of fudging or failure to disclose. But it also involved failure to see systemic risks building.
      - resters 8y ago
        The fudging was intended at first to make the books look a bit better and juice the profits. Then, once it became clear that there was a lot more risk than they had thought, the goal of the fudging became preventing the markets from finding out about the risk, to keep prices high and avoid financial loss.
      - digitaltrees 8y ago
        Management fudging numbers is a big difference form “they weren’t allowed to disclose”
    - resters 8y ago
      I'm quite sure it's true, but I can't seem to find the original citation. There were congressional hearings in 2005 because the GSEs couldn't produce financials.
      - JumpCrisscross 8y ago
        They were, to put it bluntly, fudging their numbers [1]. (From what I can tell, they were releasing timely statements to investors.) This was disclosed by the Office of Federal Housing Enterprise Oversight and rectified well before the financial crisis. Taken together, it is a bad analogy for the systemic mid-reporting of economic data by China. [1] http://online.wsj.com/public/resources/documents/ofheo20060523.pdf http://online.wsj.com/public/resources/documents/ofheo200605...
        resters 8y ago
        It was not rectified. It is analogous because it was a heavily leveraged lie — lots of policy consequences flowed from it. It’s not the size of the lie, it’s the degree to which you can leverage it. For policy makers, the best practice is to use plausibly deniable, small, but highly leveraged lies.
M4ester 8y ago
^
kasey_junk 8y ago
> Consider that Fannie and Freddie were allowed not to submit financials to markets for several years in a row preceding the 2008 housing collapse Source? I worked in that industry at that time & there was lots of odd things going on, there was never a whiff of non-reporting on their part that I remember.
contingencies 8y ago
As an outside observer, another example would be the constant redefinition of US unemployment (I hear it is now "people who haven't actively sought work for 3 months are no longer considered unemployed") which IIRC from an article has dropped US unemployment figures. It sounds like reality may differ substantially, and there is certainly a huge underground/cash economy.
- kasey_junk 8y ago
  The US BLS has long kept many different measures of unemployment. All of these numbers are watched to extreme degrees by market participants. The idea that they are constantly redefined doesn’t hold up to basic analysis by anyone who has traded on that data.
  - deleted 8y ago
    [deleted]
- nradov 8y ago
  You do not recall correctly, and since the correct information is so readily available I suspect you're just lying to try and make a political point. The definition of unemployment hasn't changed in our lifetimes. https://www.bls.gov/cps/cps_htgm.htm#concepts https://www.bls.gov/cps/cps_htgm.htm#concepts
  - contingencies 8y ago
    Err, I stand corrected. Thanks for assuming the worst of my character! I must have remembered reading some kind of article around the time summarized at https://www.americanthinker.com/articles/2011/12/os_legacy_unemployment_rate_now_meaningless.html https://www.americanthinker.com/articles/2011/12/os_legacy_u...
abvdasker 8y ago
Not going to dispute the facts of this comment, but to me this sounds like whataboutism, wherein the commenter tries to neutralize criticism by creating an equivalency with other entities which might be worthy of the same criticism. It's a rhetorical strategy that seems to come up a lot on the internet, especially when the CCP is the subject. https://en.wikipedia.org/wiki/Whataboutism https://en.wikipedia.org/wiki/Whataboutism
- majia 8y ago
  This seems a straw man argument. Whataboutism is not necessarily to neutralize critism. It is to show that sometimes China or a particular entity is held to a unreasonably high standard. How high the standard for GDP calculation is for debate, but we should not dismiss an argument by labeling it as whataboutism.
  - resters 8y ago
    Exactly. My point in making the initial comment was not to defend China, but simply to attempt to prevent the knee-jerk "America has great institutions" jingoism that is such a common reaction to stories about corruption in foreign governments. But as can be seen from my comment being brutally down voted, the force of jingoism is very strong.

JumpCrisscross 8y ago

> Fannie and Freddie were allowed not to submit financials to markets for several years in a row preceding the 2008 housing collapse Source? I’m searching and can’t find one. I also remember reading Fannie & Freddie prospectuses from that time. Each contained extensive financial disclosures.

resters 8y ago
Information was omitted: https://www.nytimes.com/2016/09/03/business/dealbook/why-no-punishment-for-financial-executives-fannie-mae-is-case-study.html https://www.nytimes.com/2016/09/03/business/dealbook/why-no-...
- digitaltrees 8y ago
  This article doesn’t support your original claim at all.
  - cryptonector 8y ago
    > This article doesn’t support your original claim at all. Could Fannie’s officers really have been accurately disclosing the risks the firm was taking shortly before its sudden collapse? It is here where the case got complicated. While he was chief executive, Mr. Mudd said that subprime mortgages accounted for about 2 percent or less of the mortgages Fannie Mae was insuring. The commission’s case largely rested on the fact that this percentage did not include the insurer’s longstanding programs for low-credit score borrowers, Expanded Approval and MyCommunityMortgage. The theory about the Alt-A loan disclosures was also not that Fannie had not disclosed that it was in the business. It classified a number of its loans as Alt-A, and told investors as much. But it did not disclose that it had instructed lenders not to classify certain other loans as Alt-A, even though they were also supported by low documentation. ... The 2008 crisis definitely involved some sort of fudging or failure to disclose. But it also involved failure to see systemic risks building.
    - resters 8y ago
      The fudging was intended at first to make the books look a bit better and juice the profits. Then, once it became clear that there was a lot more risk than they had thought, the goal of the fudging became preventing the markets from finding out about the risk, to keep prices high and avoid financial loss.
    - digitaltrees 8y ago
      Management fudging numbers is a big difference form “they weren’t allowed to disclose”
  - resters 8y ago
    I'm quite sure it's true, but I can't seem to find the original citation. There were congressional hearings in 2005 because the GSEs couldn't produce financials.
    - JumpCrisscross 8y ago
      They were, to put it bluntly, fudging their numbers [1]. (From what I can tell, they were releasing timely statements to investors.) This was disclosed by the Office of Federal Housing Enterprise Oversight and rectified well before the financial crisis. Taken together, it is a bad analogy for the systemic mid-reporting of economic data by China. [1] http://online.wsj.com/public/resources/documents/ofheo20060523.pdf http://online.wsj.com/public/resources/documents/ofheo200605...
      - resters 8y ago
        It was not rectified. It is analogous because it was a heavily leveraged lie — lots of policy consequences flowed from it. It’s not the size of the lie, it’s the degree to which you can leverage it. For policy makers, the best practice is to use plausibly deniable, small, but highly leveraged lies.

M4ester 8y ago

kasey_junk 8y ago

> Consider that Fannie and Freddie were allowed not to submit financials to markets for several years in a row preceding the 2008 housing collapse Source? I worked in that industry at that time & there was lots of odd things going on, there was never a whiff of non-reporting on their part that I remember.

contingencies 8y ago

As an outside observer, another example would be the constant redefinition of US unemployment (I hear it is now "people who haven't actively sought work for 3 months are no longer considered unemployed") which IIRC from an article has dropped US unemployment figures. It sounds like reality may differ substantially, and there is certainly a huge underground/cash economy.

kasey_junk 8y ago
The US BLS has long kept many different measures of unemployment. All of these numbers are watched to extreme degrees by market participants. The idea that they are constantly redefined doesn’t hold up to basic analysis by anyone who has traded on that data.
- deleted 8y ago
  [deleted]
nradov 8y ago
You do not recall correctly, and since the correct information is so readily available I suspect you're just lying to try and make a political point. The definition of unemployment hasn't changed in our lifetimes. https://www.bls.gov/cps/cps_htgm.htm#concepts https://www.bls.gov/cps/cps_htgm.htm#concepts
- contingencies 8y ago
  Err, I stand corrected. Thanks for assuming the worst of my character! I must have remembered reading some kind of article around the time summarized at https://www.americanthinker.com/articles/2011/12/os_legacy_unemployment_rate_now_meaningless.html https://www.americanthinker.com/articles/2011/12/os_legacy_u...

abvdasker 8y ago

Not going to dispute the facts of this comment, but to me this sounds like whataboutism, wherein the commenter tries to neutralize criticism by creating an equivalency with other entities which might be worthy of the same criticism. It's a rhetorical strategy that seems to come up a lot on the internet, especially when the CCP is the subject. https://en.wikipedia.org/wiki/Whataboutism https://en.wikipedia.org/wiki/Whataboutism

majia 8y ago
This seems a straw man argument. Whataboutism is not necessarily to neutralize critism. It is to show that sometimes China or a particular entity is held to a unreasonably high standard. How high the standard for GDP calculation is for debate, but we should not dismiss an argument by labeling it as whataboutism.
- resters 8y ago
  Exactly. My point in making the initial comment was not to defend China, but simply to attempt to prevent the knee-jerk "America has great institutions" jingoism that is such a common reaction to stories about corruption in foreign governments. But as can be seen from my comment being brutally down voted, the force of jingoism is very strong.