Showing posts with label great recession. Show all posts
Showing posts with label great recession. Show all posts

Tuesday, October 18, 2011

Something you wish you never said

"...risk to the government from a potential default on GSE debt is effectively zero."
Joseph Stiglitz, Jonathan Orszag, and Peter Orszag in a paper written for Fannie Mae.

GSE = government sponsored entity, that is, Fannie Mae

If I had said that, I certainly wouldn't be present at the Occupy Wall Street protests telling the protesters they have the right to be indignant about the private financial sector.  At the same time, I wouldn't be terribly embarrassed about the statement (not that Stiglitz is, I don't know).  That's what almost everyone thought, except for the others, who thought you can't estimate probabilities of that sort.

Mark A. Calabria.  October 15-16, 2011.  Notable & Quotable.  The Wall Street Journal.