Menzie Chinn Comes Up with Another Reason Not to Vote for John McCain
He had the bad judgment to choose somebody completely unqualified as his running mate, somebody who--if he wins--stands about a 30% chance of becoming president or acting president in the next three years:
Econbrowser: Palin, on the Ongoing Financial Crisis: In response to the largest de facto nationalization in US history, we have this example of Governor Palin's comprehension of this issue (ABC News):
Saturday in Colorado Springs, Colo., Alaska Gov. Sarah Palin said, "The fact is that Fannie Mae and Freddie Mac have gotten too big and too expensive to the taxpayers. The McCain-Palin administration will make them smaller and smarter and more effective for homeowners who need help."
I can't even start to dissect what's wrong with this statement, so I will let the reader assess Palin's understanding of the role of the GSEs in the financial system. From my perspective, I would have hoped to have more comprehension from a candidate at a time when the estimate of a resulting $300 billion taxpayer liability is viewed as plausible. For some informed discussion, see Calculated Risk, as well as Nouriel Roubini. (I was going to write about competitive depreciation in a Taylor rule framework, but this item called for immediate discussion.)