To me, even though the experts say otherwise, this feels very pre-2008. I know the experts are saying to have no fear... but that's what they were saying in pre-2008 too. I guess I'm too nervous to invest and that's on me.
So while it's relevant to brace for a small crash due to interest rates adjustments if inflation continues, I wouldn't bet on a full scale snowballing cash grab, that killed relatively healthy institutions like in 2008.
Short term money market have been greatly improved and central banks have shown multiple times their readiness to intervene.
The part that is always glossed over in MMT is that taxation is thr regulatory factor. Except that in this low trust political climate it's absolutely impossible that anyone manages to raises taxes.
Thus, I think that inflation is the greatest of current risks. Especially unacounted inflation (housing, healthcare services...).
> So while it's relevant to brace for a small crash due to interest rates adjustments if inflation continues, I wouldn't bet on a full scale snowballing cash grab, that killed relatively healthy institutions like in 2008.
This is a dangerous view because you're assuming the Fed won't be backed into a corner like Volcker. They may end up having to choose between the markets and the integrity of the dollar. When entertaining the counterfactual, it seems in hindsight like Volcker made the right call (and many economists endorse that notion), even though it manifested considerable short term pain.
The only broad market index fund owners that were hurt by 2008 were those that sold at low prices. The people that hung on a couple years were greatly rewarded.