A Great Recession Cover-Up?

Per today's housing data, we keep learning that the Big Crash was worse than many of us knew. But perhaps not worse than EVERYONE knew. How much was the Obama administration and the Fed covering up? The Fed, we learned, committed far more than anyone imagined to saving Wall Street (some $29 trillion, according to Bloomberg: see my 12/10 post, "Two Awful Numbers"). And some of the losers in the great debate inside the administration, like former Council of Economic Advisors chair Christina Romer, gave us signals of how bad things really were even as they lost their fight for a bigger stimulus. Romer, in 2009,  said the blow to public confidence from those harrowing months of 2008 was actually much worse than what happened in 1929. “The collapse in wealth was far more dramatic,” Romer said. “All told, household wealth fell 17 percent between December 2007 and December 2008, more than five times the decline in 1929.” Were both the administration and the Fed--both so vested in creating the unregulated and out-of-control financial system that came to grief -- simply in denial about the extent of the disaster they had created? I think the evidence is compelling...