Well-constructed thought experiments help us understand a problem. They do not help us predict, either what will happen, or what would have happened.
They would have something to say about hopeless wars, hollowed out communities, families who have attended too many funerals. They would say something about how to recover.
Ten years ago, funds allocated from the U. S. Treasury for the Troubled Assets Relief Program flowed to banks to keep them afloat.
Wave upon wave of fraud became so rampant among bankers, they gradually and then completely lost confidence in each other. They also – rightly – lost confidence in their assets. The collapse we saw resulted from bankers making a run on each other’s institutions. In the situation they had created, panic was a rational response.
What do you call a policymaker who approves a policy, participates in a decision, or takes a significant action, then …