By now it’s an article of faith within the sound money community that most major countries have borrowed so much that they’re left with only two options: default on their debt through mass-bankruptcy and a new Great Depression, or inflate it away through stepped-up currency creation.
This is an investment thesis, since a given country’s choice will determine which asset classes rise and fall.
But it’s also a criticism of the people and policies that put us in this box. The presidents, prime ministers, senators, central bank heads and investment bankers who presided over the global economy of the past 30 years screwed up monumentally, leaving today’s savers, entrepreneurs and workers to clean up their mess.
Because acknowledging this stark choice between inflation and Depression is such an admission of failure, it isn’t discussed in these terms on the official side of the debate. There, the tone is more measured and the promise is that the next tweak will more-or-less painlessly return the system to a stable equilibrium of steady growth, full employment and incumbent electoral success.
This post was published at DollarCollapse on September 10, 2014.
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