Two prominent economists (who are both friends of mine) are having an important public policy debate about FHA default risk. Wharton's Joe Gyourko has written a new working paper that argues that FHA will be the government's next bailout given that it has insured a large number of loans that are of risk to default. HUD's Raphael Bostic has written a sharp critique of the Gyourko study and here is Gyourko's response to the Bostic critique.
Note how economists debate with each other. We discuss evidence and methodology. I take pride that there is a certain scientific approach here for how we engage and evaluate which points are convincing and which are not.
Two prominent economists (who are both friends of mine) are having an important public policy debate about FHA default risk.idvy0824
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