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Even currencies maintaining convertibility to gold are still subject to bond yields, interest rates, trade and capital flows. It’s widely held that all of our financial woes are the result of abandoning the discipline of the gold standard in 1971.

Price cutting is being replaced with price gouging, a substitution that consumers recognize as inflation.. Globalization was deflationary, Deglobalization is inflationary. The entire point of globalization is to 1) lower costs as a means of maximizing profits and 2) find markets for surplus domestic production.

Events may show that there are no winners, only survivors and those who failed to adapt. Some recessions are brief, necessary cleansings in which extremes of leverage and speculation are unwound via painful defaults, reductions of risk and bear markets.

So what are conventional pundits missing today? I would start with three dynamics. Only old people experienced real recessions–those in 1973-74 and 1980-82. Recessions since then have been shorter and less systemic.