"But when they get off, they don't give up their internal models very easily".
What makes the image powerful, is it provides a tool to probe these internal models," he said.
As children grow, their brains build internal models of everything they encounter, gradually learning to identify objects and to predict how they move through space and time.
The idea is to facilitate balance orientation by overriding internal models in the brain that give rise to feeling off kilter.
Insurers are among the gainers after the Bank of England gave the green light to 19 institutions on their internal models on solvency levels.
Another judge, with another set of internal models, may perceive that the security of the school or airport is the most consequential fact.
According to Dr. Hain's theory, this is because their internal models are once again consistent with what is actually happening around them.
It has since retreated from that position and modified its internal models (ie, made them less optimistic).
As Ben Bernanke reiterated on Capitol Hill yesterday, this is what the Fed's internal models are predicting, and it also jibes with the conventional wisdom view on Wall Street.
The rule requires companies to provide dollar values for the portion of their assets that are priced based on market prices versus those that are priced based on internal models.
The company says that its internal models show that the bonds are suffering only a temporary loss in value and that it does not need to write them down.
