One of the key reasons for me to abandon most of stocks and keep metals and cash is due to the study and in depth engross study of the Global Financial System and its history. Partly also attributed to Ray Dalio.
Below are articles I written after listen / read about Ray’s explanation of the Global Financial System. Of course there are others like Jim Rogers, Mike Maloney who also influenced my thinking back then.
In this article, I will copy and paste back what I wrote in 2015 to let readers understand what are stages of post Deflation (or post – crisis) in today’s situation.
It will normally not go straight to Depression in a crisis. In fact, to me, 2008 GFC is already the trigger point to possible Depression. I am not saying that 2020 will be Depression, but I am saying we are heading towards that path. It can be 2030, nobody knows, but the trend is always the same:
– Crisis, lower interest, QE (create money out of nothing), Helicopter Money, Inflation, Hyperinflation -> Depression.
Depression is what Ray Dalio described as Long Term Debt cycles. And the 7-10 years crisis are Short Term debt cycles.
If Interest zero, QE too much such that monetary policy does not work anymore, Government may “literacy” hand money to people to spend. This is Helicopter money!