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Leaking under stress - Paul Krugman Blog - NYTimes.com (May 4, 2009)
John Hempton has a good question, which other people have asked me: who is leaking about the stress tests?

...

... there's Yves Smith's version: these are all trial balloons to see how outsiders will react to different stress reports.

But that just adds to the bad feeling about all this. Even Brad DeLong, who has been relatively sympathetic to the administration here, is disturbed by the idea that regulators are negotiating with the banks about the test results. Now it seems as if the report's contents may also be dictated by what, based on the response to leaks, the informed public is willing to swallow. ("Would you believe it if we say Citi is fine? OK, what if we say they need $5 billion? Not enough? How about 10?")

Ouch.

Most economists teach a theoretical framework that has been shown to be fundamentally useless. -- James K. Galbraith
by Carrie (migeru at eurotrib dot com) on Wed May 6th, 2009 at 09:29:06 AM EST
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