The Bernanke Code


Bernanke's economy goes like this. David Kestenbaum/NPR hide caption

itoggle caption David Kestenbaum/NPR

Years before Ben Bernanke became Fed chairman, he worked on an elaborate computer model of the economy. You can ask it useful questions like "How bad will things get if there isn't a bailout?" Find out what it has to say in a story from this morning. I talked with both of Bernanke's collaborators.



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i wonder: how are the risk assessment models (devised by all the smart guys that packaged up all those mortgages) doing right now? i mean, didn't a lot of people try and use those as "crystal balls"? oops.

Sent by ryan | 11:26 AM | 9-26-2008

Here is my financial model. It is "attitude is contagious". For example if Government is irresponsible, it citizens will be also. When we ignore infrastructure, give tax breaks and use regressive means to provide social services, the citizens believe that is the correct way to conduct their own affairs. Does the economic accelerator look at public spending in respect to taxation? My gut tells me we are in for troubling times. The roman empire got too big to manage. Does this Band-Aid really address the underlying problem?. As a democratic society we are schizophrenic in that we want the freedom of capitalism, the benefit of socialism without the burden of fair taxation. It is a let the dead bury the dead attitude.
What is missing from this plan is the responsibility to do things differently. We must take away the gambling money before we pay the rent.
I have several ideas I would like to plug into the model.
For starters
What would happen if all investments held less than a year were considered gambling and required payment of a 50% tax. Also prevent gambling losses from being a business deduction.

Sent by ray | 11:54 AM | 9-26-2008

I got a plan on how to un-crack the Bernanke code. Give his equations to the makers of SPORE and SIMS. Pay them to design a game that can be played online. Pay players rewards for designing successful economic systems. Pass laws based on the best models . It is a great distributed model on human computing. Just think how hard it would be to simulate the human model on a computer.

Sent by ray | 12:15 PM | 9-26-2008

First the Democrats blindly follow Obama ... now, they are willing to blindly follow Reid, Bush and Paulson ... in a decision which could dramatically affect every American for decades. Well, thank God, Senator John McCain, Senator Shelby, and hundreds of economists don't just want to take a few people's word for it. Already, Reid has tried to tack additional pork, like Acorn, to this bailout. I didn't think I could dislike inept Harry Reid, with his 15% approval rating, any more than I already did, but this isn't about Reid being left alone to decide America's future. It will be interesting to look back at this in retrospect, to see if we really did have to RUSH this 750 Billion dollar decision ... and, who really benefitted from pushing it through so quickly.

Sent by Howard | 1:14 PM | 9-26-2008

Good source for understanding the fallacy of the "bailout" approach is the not-for-profit site: Alarming yet insightful. Each article includes a bio of the author.

Sent by jb | 1:32 PM | 9-26-2008