Thanks Jeanette. The article, An inflationary depression really is too much to take in all at once. I had to break it down into bite-size pieces and still don’t fully understand how it all unfolds. Like I said in an earlier post, imo it’s all an experiment.

You could probably teach a post-grad economics course based on this article. Lots of info, theory and statements that could be discussed and dissected at length. Regardless, the last three paragraphs wrap it up quite well:
Quote:
Sentiment in banking circles will turn on a dime, when bankers stop believing their mollifying in-house economists and pay attention to what their banking antennae tell them. They will rapidly discover that the crisis in international trade is undermining the creditworthiness of domestic non-financial businesses. They will also do everything they can to reduce counterparty risk with foreign banks deemed to be at risk of bankruptcy in their own markets.

As night follows day, another banking crisis will rapidly escalate, this time likely to be on a greater scale than ten years ago. And the evidence from failures in the dollar repo market in recent weeks points to the banking system beginning to unravel now.

Between the wars, the world suffered a deflationary depression. This time, we appear to be travelling towards an inflationary depression.