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> And then when they go bankrupt they present the bill to the tax payer.

... and get bailed out - which means that they are using a perfectly rational and profitable investment.

> these models haven't changed for decades even though they have clearly failed many times.

They may have failed you and the economy at large, but with very few exceptions (e.g. Lehman), they have not failed the people who are running them, which is why they keep using them.

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Yes sort of. This is the obvious that bothers many.

Of course there is also a deeper culture here. For instance that students in big name universities learn standard macro economics. And then when they come to the institutions this is their default mode of thinking, even though they don't directly benefit from this. But it might be hard to reach to top of many of these institutions as a contrarian, so longterm there is not much incentive to go against established norms.

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