Phase Change

A place for a moment
An end to a dream
Forever I loved you
Forever it seemed
--The Motels

At 32 degrees, water turns to ice with little transition. Temperature drops a fraction of a degree and liquid turns to solid.

Crowd behavior is similar. The herd moves in particular direction until a small, perhaps indiscernable stimulus prompts the masses to change course.

Throughout history, all major inflations, defined here as large declines in purchasing power of money, have occurred relatively suddenly. Although plenty of warning signs go up that the value of money is being destroyed, the public continues to believe that the institution called the dollar will remain stable.

Then, something causes confidence in the currency to rapidly disintegrate. People being unloading dollars in their wallet in favor of things perceived to hold more value. The dollar falls more. Then more dollars are sold.

Etc.

We are headed toward a repeat of history. Central banks are printing $trillions. We see it but don't act. Suddenly, one day, we will act en masse.

And the dollar quickly joins the list of currencies that are no more.