According to the IIF’s in-house econometric models, a 2 percent increase in capital requirements for the G-SIFI would cut GDP in the United States, Japan and Europe by 3 percent and would reduce annual growth by as much as 0.6 percent. With the recovery struggling to achieve growth of 1 or 2 percent, that was an ominous forecast.64 It was a tendentious and hypothetical argument that the advocates of capital raising were forced to counter with their own even more elaborate econometrics.
