Mark Burgess the former CEO of Australia’s Future Fund shares his assessment on the recent sell off in risk assets. Specifically he believes markets are flagging the prospect of a deflationary recession – a scenario foreign to many investors. “What happens when you are dealing with deflation and excess supply, the supply eats away at you like a cancer. So as an investor, in any asset you look at, think of supply as your #1 issue because that is what will corrode the market.” Burgess says markets are concerned about excess supply, however, he thinks they are potentially even more concerned about the lack of tools available to central bankers. “Excess supply recessions are completely different. They are different because you don’t get an apparent crisis, it just eats at you. And the problem with that is that politicians don’t respond. This is why here in Australia we have probably got excess supply going on in a whole bunch of places but there is no political will, because there is no apparent crisis.”