In a followup post, Soltas outlined the gargantuan obstacles to the sort of modeling that underlies these sorts of simulators. I think he's all around done a great job overcoming them, however.
My first attempt was going along fine until Zimbabwe set in. I think I allowed the Funds rate to stay so low so long that my 'citizens' came to anticipate low rates forever. Thus my wild punches (2020 and onward) at inflation never landed. My next attempt, the results of which I will also post to CW, will hopefully be less Weimaresque.
I'd encourage readers to try the simulator out and see what you get.
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| First sad attempt |
Good job on unemployment!
ReplyDeleteYeah, thanks; a little too good, unfortunately. I was actively trying to push that up by 2018-19, but I wasn't quick enough on the trigger finger to avert the inflationary death-spiral. There are several other 'deeper' indicators in the simulator, but, alas, no measure of wheelbarrow sales, which were likely very, uh, robust.
ReplyDeleteI did better the second time around, though. The lag (and subsequent persistence) of inflation expectations has been my chief bugaboo, which reflects the realism of the simulator.