Post Hoc Not Always Propter Hoc

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The Census Bureau announced today that housing permits were up 11.6% in September compared to the previous month. Matt Yglesias thinks Ben Bernanke deserves the credit:

That’s all great news for the economy. I also think it’s a clear sign of the power of QE3….Since monetary policy primarily works through expectations, it primarily works very quickly. QE3 was clear, forceful, and yet also relatively modest so a short-term one-off surge in investment activity (housing starts) and durable goods purchases (car sales) followed by a speedy return to the trend growth path is exactly what we should expect.

Well….maybe. But QE3 was announced on September 13, so it would have to work very quickly indeed to affect housing permits in the same month. Too quickly for the real world, I think. First, there would need to be one heck of a lot of builders with plans all drawn up and financing in place, eyes fixed on CNBC just waiting for the right moment to submit their applications. Second, local bureaucracies would then have to circulate the applications to all the various planning agencies, review and approve whatever variances are required, and issue the permits in record time to make the end-of-month cutoff. It’s true that the September number is well above the recent trend, but color me skeptical that QE3 had anything to do with this.

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Which is also a pretty great way to describe Mother Jones' mission: People coming together around the truth to hold power accountable.

And right now, we need to raise about $400,000 from our online readers over the next two months to hit our annual goal and make good on that mission. Read more about the information war we find ourselves in and how people-powered, independent reporting can and must rise to the challenge—and please support our team's truth-telling journalism with a donation if you can right now.

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