Does anyone want to open a consulting/lobbying firm with me where we just make up numbers? Like Mr. Ford does with polling statistics in Frisky Dingo, if you are fans, but with financial institutions? (Please avoid the obvious joke of “isn’t that what financial engineering is entirely?”)
There’s a new study, “The Effect of the Consumer Financial Protection Agency Act of 2009 on Consumer Credit” (Evans/Wright) where they try to figure out the adverse effects that the CFPA will have. I’m incredibly sympathetic to this argument, and was hoping to see a really sophisticated review of the potential numbers. Instead they lead with scare statistics (4.2% new job loss!) that are entirely hypotheticals (we assume (.05 x .867) = 4.2% new job loss). It’s a lot of noise when we need signal.
Anyway, Credit Slips demolished it on at their page (“The short answer: just make up the numbers. I kid you not.”). I came to a similar critique and forgot to link to it here, go and check it out over at the Business Channel.
Everyone knows that moving closer to the regulatory structure of the 1950s and 1960s would mean crushing unemployment.
As opposed to what we have right now?
That’s kind of my point.
Sorry, my sarcasm meter must have been malfunctioning that day.
You can see various people on cnbc implying similar things earnestly, so don’t worry about it. I mean someone obviously thought all these financial regulation measures were good, or they wouldn’t have been passed through congress.