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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 financial
by 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 agoThey 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 agoIt 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.