Debt-Deflation Spiral Simulator

Financial crises rarely start as a single collapse — they start as a feedback loop. A falling asset price shrinks the collateral behind outstanding loans; banks pull back credit to compensate; the shortage of credit slows the real economy and forces leveraged holders to sell assets to deleverage; those sales push the asset price down further, restarting the cycle. This simulator isolates that loop into three linked indices — Price, Credit, Output — and lets you tune the shock, how tightly credit is tied to collateral, how much leverage forces fire-sales, and how large a capital buffer the banking system holds. Small shocks with a healthy buffer damp out; large shocks with high leverage and a thin buffer spiral into a full debt-deflation crash, the mechanism behind the Great Depression, the 2008 global financial crisis, and the 1997 Asian crisis.