Wed April 28 2021
This is an interesting observation. Everyone is thinking inflation. But as shown credit expansion preceeds a deflationary collapse. We now have years of near zero interest credit expansion.
Things look similar to the late 1920s when downtown were seeing building booms and the markets were setting new highs, ditto March 200 and Fall 2007. Just yesterday a fund manager
committed suicide by jumping from the tenth floor of a Fifth Avenue office building (note that is really not high enough he might have survived but in terrible condition).
And we have the Archegos, Luckin, and Wirecard collapses already in the record books. All of those were deflationary. I think the story is that easy money leads to excess speculation of all kinds which does not end in growth, ie the Panic of 1907. And as every talking head on CNBC or Fox Business or the front page of the WSJ thinks of only a rosy future, well ....
click hto read EWI's take on a 70 year credit expansion.
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