Posts filed under “Really, really bad calls”
While everyone is so focused on the anniversary of Lehman Brothers (9/15) and AIG (9/16), today is a different sort of anniversary: Its been exactly one year months since the single dumbest column ever published in The Washington Post appeared: Quit Doling Out That Bad-Economy Line.
Breathtaking in its ignorance, shocking in its fallibility, astonishing in its author’s perversely misperceived world view, it stands as a monument to sheer cluelessness in a single person:
“There have been 11 recessions since the Great Depression. And we’re nowhere close to being in the 12th one now. This isn’t just a matter of opinion. Words — even words as seemingly subjective as “recession” — have meaning.”
-September 14, 2008
It turned out that we were already in a recession for 9 months — and it was about to get a whole lot worse.
The article goes on to deny the Housing slump, misreads the debt markets, recommends equities, states that bank capital was more than sufficient, looked at employment trends as proof there was no recession, applauds economic growth levels, decried the use of the terms crisis” and “meltdown” — and gets every single one exactly wrong.
If you had a time machine, knew the future, and purposefully tried to write something where every word was literally wrong, you could not have done a better job.
Be sure to read the whole embarrassing thing if you want to enjoy a good chuckle.
Quit Doling Out That Bad-Economy Line
By Donald Luskin
Sunday, September 14, 2008; B01
Category: Really, really bad calls
Here it is, one year later, and we continue to hear an enormous amount of misinformation about the Credit Crisis: What were the actual causes, what could have been done, what should have been done. Lets consider the most widely held myths as the the cause of the crisis (skipping discredited nonsense). Here is a…Read More
Tyler Cowen’s NYT column today, Where Politics Don’t Belong, comes perilously close to the mark in identifying the key problems of the bailouts: They encourage a reliance on special Government dispensation, regulatory exemptions and taxpayer handouts: “FOR years now, many businesses and individuals in the United States have been relying on the power of government,…Read More
This has to be the single dumbest thing I have read in months: Investment Bank Profits May Drop on Regulations, JPMorgan Says. (Note: I am referencing the analyst report, not the Bloomberg story) Here’s a news flash: With the least amount of regulatory oversight in generations in the 1990s and 2000s, bank profits were less…Read More
In keeping with our theme of beating the mainstream press by months and sometimes years — I always try to beat the Noble Laurelates by at least 6 months — I wanted to point to both the massive Krugman piece in the Sunday Times Magazine, as well as referencing similar themes we’ve hit upon over…Read More
This is from “News from 1930” website “There’s a large amount of money on sidelines waiting for investment opportunities; this should be felt in market when “cheerful sentiment is more firmly intrenched.” Economists point out that banks and insurance companies “never before had so much money lying idle.” -August 28:, 1930 The more things change…Read More
I try to follow the advice “Never pick a fight with people who buy ink by the barrel full,” but every now and again, I simply cannot help myself. Today is one such an instance. Like all human beings, I am wrong on a regular basis (my wife can read you chapter and verse). However,…Read More
Category: Really, really bad calls
Here’s another of those articles that look so embarrassing one year later: Can you imagine an article that insinuates that the government, not an independent academic commission, was the more objective arbiter of data? That argued we should let the pols decide when recessions start and end? Insane, right? Let’s go to our WTF were…Read More
Blast from the past: Turmoil in the housing market has led to fears that home prices will drop precipitously, particularly if foreclosures force large numbers of homes onto the market in the coming year. Recently, these fears have driven financial stocks down and led to the government rescue of Fannie Mae and Freddie Mac. But…Read More
One of the more fascinating things about a crisis and its resolution is the post-mortems: The after-the-fact analyses that some folks do to explain what occurred. These analyses are fascinating for what they reveal about the beliefs, methodologies, biases and cognitive failures of the many crisis watchers. Human fallibility being what it is, we can…Read More