Visualising the deflationary denouement
We already know it’s going to be hyperinflation or deflationary depression.
The Makian Distribution predicts this: unprecedented public and private debt means unprecedented volatility. The one absolute certainty is that you will no longer get steady 4% returns year-by-year in any asset class. You will either double your money in a year or be wiped out completely. Government bonds will have insanely low (even negative) yields – and then suddenly be worthless within weeks.
Now, David Calderwood imagines the deflationary scenario as vividly as anyone has this year. As a deflationist, I’m visualising something very similar to happen, short of Bennie Boy dropping toilet paper fiat from helicopters – which ironically is unlikely given he speculated he’d do it if he had to. Once an academic speculates on something so stupid in an academic paper, he’s highly unlikely to follow through in reality.
The only question I have for David Calderwood is the same one I have for Steve Keen: WHEN?
