Looking Behind the Aggregates: A Reply to "Facts and Myths about the Financial Crisis of 2008" Looking Behind the Aggregates: A Reply to "Facts and Myths about the Financial Crisis of 2008"

By Ethan Cohen-Cole, Burcu Duygan-Bump, José L. Fillat, and Judit Montoriol-Garriga

As Chari et al (2008) point out in a recent paper,offsite aggregate trends are very hard to interpret. They examine four common claims about the impact of financial sector phenomena on the economy and conclude that all four claims are myths. We argue that to evaluate these popular claims, one needs to look at the underlying composition of financial aggregates. Our findings show that most of the commonly argued facts are indeed supported by disaggregated data.

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