Via Mark Thoma, Susan Woodward has an idea:
The true values of mortgage assets are generally thought to be a mystery. But
little-mentioned among discussions … of the crisis is that the Treasury has
access to the best resources in the business for estimating the hold-to-maturity
values of mortgages and mortgage-backed securities. This team is at Fannie Mae,
which the government now effectively directs.
Krugman’s award could bring Bush face-to-face with his
antagonist. The president typically invites Nobel Prize winners
to the White House in November or December.