Tag: economics
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Bernanke: Individual power increases network risk
Oct. 15 (Bloomberg) — Federal Reserve Chairman Ben S. Bernanke said the central bank will consider discarding its long- standing aversion to interfering with asset-price bubbles and warned that the banking business may be concentrated in too few companies. Sounds familiar.
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Bailouts: Understanding Risk in a Networked Economy
Individual power increases network risk. When the power goes, so does the network. But, this risk can also mobilize everyone else to buoy up the network by supporting the powerful (AIG rescue) or group cooperation (bailout lobbying). When a power fails, there will be painful redistribution of wealth (Lehman Brothers) and the market as new…