Economists should have predicted Lehman collapse: OECD

paris - Mainstream economic thinking did not reflect the reality, says OECD head

The head of the OECD said on Friday that he regretted the rich nations club's failure to predict the crisis triggered by the collapse of Lehman Brothers a decade ago, saying economic forecasts needed to better reflect reality.

"At the end of my first year in office, in June 2007, the OECD economic outlook stated 'the current economic situation is in many ways better than what we have experienced in years'," Angel Gurria said.

"When one is so happy to be professionally optimistic, then of course you disregard the voices that are warnings."

Gurria said the crisis had made clear that "mainstream economic thinking and the models it was based on did not reflect the reality either of the economy or people's life".

"This is why we did not see it coming. We had it wrong and we will have to confess that," he said.

"We can begin by not turning a blind eye to the sentiments of the people we left behind, we must listen to what the people have to say," Gurria said at the OECD headquarters in Paris. - AFP