Tuesday, March 3, 2009

Lack of Data

Does this not sound familiar?
Bernie Sanders wants Ben Bernanke to name names.
The money Sanders is referring to is loans the Fed has made outside the TARP program. Bernanke says the loans are "over-collateralized," but opted not to disclose anything more about them, citing the "stigma" attached to receiving such loans. To that, I have only two comments.

First, what stigma? The market is now assuming that every financial firm is in deep doo-doo. If anything, knowing which firms are receiving help and which are not removes one of the biggest uncertainties out there. It might actually improve the markets.
The lack of information in the world's finances directly parallels the lack of knowledge we have in oil reserve accounting.

What you cannot measure you cannot control. And that is why we have to model and simulate and analyze this stuff by our lonesome. The corporatocracy will never lift a finger to help.