 Let me start by asking, what is your first association when somebody talks to you about the economy? Do it? Is the image that you get factories working, supermarkets full of people, busy Wall Street or what? I would like you to think of the economic system as a web of contracts, contracts and understandings among agents in the economy. Some of them are fulfilled, expired, others are renewed, the web is constantly renewed. Problem is, in this renewal of the web of contracts, the whole web can develop instability. The instabilities come in different sizes if you want. We have first just an individual isolated default. There is at any given time a probability that that will cause somebody else to default. In a reasonably robust credit system, these chains of defaults will be very short, but the web can develop into a state where one default will trigger an avalanche. And those avalanches differ in size, taking down, as it were, bigger or smaller portions of the web. But a highly fragile economy has the possibility of crashing altogether. Normally in an economy, most of the productive assets are engaged in their most valuable uses. And normally they are managed by those who can get the most value from them. When defaults start to happen or threaten, fire sales will not realize that value. So debtors will try to run positive cash flows in order to service and pay down debts. Debtors try hard to leverage and creditors fail to run cash deficits. Then falling asset prices and shrinking incomes will exacerbate deflationary pressure. A general decline of prices or a general contraction in activity will raise the real burden of debts and the more so, the harder people try to pay and the harder they try to collect. So the logical end point of that process of a debt deflation is a situation where all remaining debts are unpayable and all the claims are uncollectable. What we are almost constitutionally unable to think about is how macroeconomic instability relates to notions of fairness of justice in the distribution of income and wealth.