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Alasdair Macleod, Michael Oliver and Michael Hudson return. Downturns in bank credit expansion always lead to systemic problems. We are on the edge of such a downturn, which thanks to everyone’s focus on COVID-19 is unexpected. On March 23rd markets stopped worrying about deflation and realized that monetary inflation is the certain outlook. That day, the Fed promised unlimited monetary stimulus for both consumers and businesses, and the dollar began to fall. Commercial banks everywhere are massively leveraged and their exposure to bad debts and a cyclical banking crisis is now certain to wipe
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