Although I find myself disagreeing with Barry Ritholtz more frequently these days, I think his post today about bailout counter-factuals is pretty much dead on, and is a must read.
"My disagreement with the Zandi-Blinder report is not its theoretical underpinnings — it is by definition a hypothetical counter-factual. Rather, it is the counter-factual Blinder/Zandi used: “What would the economy look like now if we had done nothing?”
Instead, I propose a better counter-factual: “What if we had done the right thing, instead of nothing — or the wrong thing?”"
Click on over to Barry's blog to read the whole thing.