Submitted by pranshum t3_11u8mhn in dataisbeautiful
Future_Green_7222 t1_jcmytwo wrote
Current economic thinking: bank failures are independent random variables, so the probability of multiple failing at the same time is low
Spillz-2011 t1_jcn054h wrote
Who says this? If this was the thought there wouldn’t have been a rush to shore things up this week both in the us and credit suisses
thehallmarkcard t1_jcn82l0 wrote
That’s just not true. We literally do bank contagion simulations and there’s a ton of research on this topic. Prevailing economic thinking is precisely the opposite of what you said.
jim-bie t1_jcn8lf6 wrote
I have no idea about economics or finance or whatever but I highly highly doubt bank failures are even anywhere near independent
jim-bie t1_jcn8p52 wrote
I have no idea about economics or finance or whatever but I highly highly doubt bank failures are even anywhere near independent
Also if that was true, wouldn’t the distribution here be highly highly unlikely?
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