Even though this is a report by the St. Louis Fed, it’s a report about the whole country, not just the St. Louis area. The St. Louis branch of the Fed specializes in research and reporting. Until recently, it’s where we got BOGUMBNS (aka M0) reporting from, to expose the vast increase in physical cash circulating as a result of quantitative easing. “Until recently,” because they no longer report it. I guess we’re not supposed to know certain things.
I don’t have the time or ability at this moment to give serious brain power to possible flaws in their methodology, but I want to note that this is interesting:
The analysis aimed to examine a general assumption that high-risk borrowers — blacks, Hispanics, the young and the less-educated — regularly employ bad choices and risk-taking behaviors when taking out loans.
“A general assumption?” From whom? By whom? I know I assume it, and I know you assume it. But that’s because we’re part of the untouchable untermenschen of the alt-right. Official polite society does not allow us to think about these things or even know these things. So, if STL Fed is thinking that this “general assumption” is pervasive such that they must refute it, then it must be because people are coming to the conclusion on their own, not because they are officially instructed to think that. As you can infer from this article, we are officially instructed to discount that.
Just as an ice breaker, I think the main problem with this methodology is that its authors think there’s a necessary Berlin Wall between “bad choices and risk-taking behaviors” and “financial circumstances.” When in reality, the former can affect the latter, and the existence of the latter can be evidence of but is not necessarily proof of the former.
Also, they tell us about blacks, Hispanics and whites. But not about Asians, curiously.