{"id":54842,"date":"2020-08-27T10:20:01","date_gmt":"2020-08-27T15:20:01","guid":{"rendered":"https:\/\/olduvai.ca\/?p=54842"},"modified":"2020-08-27T10:20:38","modified_gmt":"2020-08-27T15:20:38","slug":"is-high-inflation-now-a-bigger-danger-than-a-deflationary-crash","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=54842","title":{"rendered":"Is High Inflation Now A Bigger Danger Than A Deflationary Crash?"},"content":{"rendered":"
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Is High Inflation Now A Bigger Danger Than A Deflationary Crash?<\/a><\/h3>\n

What\u2019s the more likely event at this point: a deflationary crash or runaway inflation?<\/p>\n

For a long time, Peak Prosperity co-founder Adam Taggart and I have hewed to the \u201cKa-POOM!\u201d theory, which states that a major deflation will scare the central banks so badly that they overreact and pour too much liquidity into the system, thereby destroying it.<\/p>\n

To visualize how this will play out, think of\u00a0<\/span>what happened in Beirut this week. Customs officials there stored thousands of tons of ammonium nitrate fertilizer at their seaport, for years.\u00a0 The pile just sat there doing absolutely nothing.<\/p>\n

After years of inaction, the port authorities became lulled into the erroneous conclusion that nothing would ever happen.<\/p>\n

But then one day a spark came to life, starting a fire, and then all at once \u2014 POOM! \u2014 the entire thing\u00a0blew up<\/a>\u00a0with devastating effect.<\/p>\n

This analogy works pretty well here as we approach the Keynesian endgame facing the global economy.\u00a0 The pile of $trillions in bad debts issued over the past decades has been the fertilizer.\u00a0 Covid-19 was the spark. And now we\u2019re simply waiting for the entire economic and financial system to explode.<\/p>\n

The same process began in the US and has been unfolding across the world ever since after the gold standard was abandoned in 1971.\u00a0 Untethered from any restraint, all that was left to staunch the flow of red ink was self-restraint and a concern for the future, both of which were in short supply.<\/p>\n

Not only has debt been growing far faster than income (GDP) at the national level, but debts have been growing exponentially (i.e., \u2018compounding\u2019) ever since 1971:<\/p>\n

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That debt growth is a nearly perfect exponential curve upon which the entire systems of politics, banking and the economy have come to rely.<\/p>\n

\u2026click on the above link to read the rest of the article\u2026<\/p>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Is High Inflation Now A Bigger Danger Than A Deflationary Crash? What\u2019s the more likely event at this point: a deflationary crash or runaway inflation? For a long time, Peak Prosperity co-founder Adam Taggart and I have hewed to the \u201cKa-POOM!\u201d theory, which states that a major deflation will scare the central banks so badly […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[9860,124,3596,195,202,286,303,309,374,1183,426,9454,2218,3650],"class_list":["post-54842","post","type-post","status-publish","format-standard","hentry","category-economics","tag-adam-taggart","tag-central-banks","tag-chris-martenson","tag-debt","tag-deflation","tag-exponential-growth","tag-fed","tag-fiat-currency","tag-gold","tag-gold-standard","tag-inflation","tag-ka-poom-theory","tag-peak-prosperity","tag-us-federal-reserve"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/54842","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=54842"}],"version-history":[{"count":2,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/54842\/revisions"}],"predecessor-version":[{"id":54844,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/54842\/revisions\/54844"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=54842"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=54842"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=54842"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}