The extent of spillover depends upon complex patterns of interdependencies between the immediate source of the financial disruption and other parties, and the speed and cost with which affected parties could obtain substitute providers for the financial services that have been disrupted.
Complex economic models are indispensable tools for economists, particularly those who work at central banks. However, these tools are all based on historical averages and embrace several simplifying assumptions that may not hold in reality. Every relationship in the Bank’s models is meant only to approximate how part of the economy will behave, on average, over time.