Why subprime is worse than 9/11

Osama bin Laden once said that his goal is “bleeding America to the point of bankruptcy.” Maybe he should have gotten into the mortgage business instead of becoming a terrorist. Zubin Jelveh blogs a new IMF working paper by Hui Tong and Shang-Jin Wei, who look at the responses by economic forecasters and consumers to ...

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Osama bin Laden once said that his goal is "bleeding America to the point of bankruptcy." Maybe he should have gotten into the mortgage business instead of becoming a terrorist.

Zubin Jelveh blogs a new IMF working paper by Hui Tong and Shang-Jin Wei, who look at the responses by economic forecasters and consumers to 9/11 vs. their reactions to the subprime mortgage crisis. As you can see, everybody pretty much shrugged off 9/11 (at least when it comes to the economy; emotional grief is, of course, beyond measure) after about six months, but subprime has brought a steady decline in confidence:

Osama bin Laden once said that his goal is “bleeding America to the point of bankruptcy.” Maybe he should have gotten into the mortgage business instead of becoming a terrorist.

Zubin Jelveh blogs a new IMF working paper by Hui Tong and Shang-Jin Wei, who look at the responses by economic forecasters and consumers to 9/11 vs. their reactions to the subprime mortgage crisis. As you can see, everybody pretty much shrugged off 9/11 (at least when it comes to the economy; emotional grief is, of course, beyond measure) after about six months, but subprime has brought a steady decline in confidence:

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