Things Everyone In Chicago Knows

[Seneca]

Ah, Krugman! Surely he knows, as Stephen Colbert says, that reality has a liberal bias. :-)

Which happen not to be true.

It was deeply depressing to see Raguram Rajan write this:

The tsunami of money directed by a US Congress, worried about growing income inequality, towards expanding low income housing, joined with the flood of foreign capital inflows to remove any discipline on home loans.
That’s a claim that has been refuted over and over again. But what happens, I believe, is that in Chicago they don’t listen at all to what the unbelievers say and write; and so the fact that those libruls in Congress caused the bubble is just part of what everyone knows, even though it’s not true.

More, with charts, here:

http://krugman.blogs.nytimes.com/2010/06/03/things-everyone-in-chicago-knows/