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vox kadavergehorsamkeit
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Hyperinflation or Hyperdeflation?

- Antal E. Fekete - Gold University

Nice to see it was not 300 and done.

Your assertion may be accurate. Certainly for a time it should prove true. What remains to be seen is just how severely society gets shaken by the collapse of many, perhaps all of the debt instruments, backing the major currencies we know and distrust. Certainly it will be cause for drastic changes. There would seem to be a number of possible outcomes and much would depend on just how orderly of a transition to a new and trusted medium of exchange could be executed. The longer one of those black swan events that they talk about can be averted, the better the odds are that China, along with the other BRICS can have something viable in place so as that trade does not collapse completely.

But a disorderly collapse could arise as a result of one of many looming disasters. Japan, as but one example, by trying to inflate the yen, could destroy their own government bond market. Or given the lunatic policy of bailing in depositors, a run at one of the big French, Italian or German banks could start us cascading back to a time similar to the collapse of the Western Roman Empire. We know it as the Dark Ages. There were no rights. There was no property. There was not even money. Most everyone who was not a lord was the personal property of the dude who said you and everything you would ever produce belonged to him because your mother gave birth to you on his property. Japan went through a very similar stretch of time where they simply stopped minting coins and used a standard size bag of rice as their medium of exchange. Who is to say that we are not headed down that same path? Given what seem the incomprehensibly ill conceived policies of the national and supranational bodies to deal with the situation, the only mystery seems to be the actual moment when total collapse can no longer be averted. And of course, to what degree does society break down? Does it go on for only weeks, or will the next gold coin not be minted until 2638?

Commented 3986 days ago

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Beginning of the headline :The reason why QTM fails is that money is not one-dimensional. It is in fact two-dimensional. Quantity is one, and the velocity of circulation is the other dimension. Central banks control the former, and the market firmly controls the latter. As long as fair weather lasts, velocity may be ignored. But as soon as the weather grows foul, velocity returns with a vengeance. If it increases, we talk about inflation. If it decreases, we talk about deflation. In the extreme... Read More

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