- Deception and trust form a **coupled dynamic system**, formally analogous to predator–prey (Lotka–Volterra) or host–parasite models.
- **Gresham's Law generalized:** bad behavior drives out good *up to the point* where trust collapse makes deception unprofitable, at which point the immune response (regulation, reputational punishment, exit) restores trust, and the cycle repeats.
- The equilibrium is **unstable and cyclical**, not static — explaining recurring fraud waves, bubbles, and regulatory pendulums (Kindleberger, *Manias, Panics, and Crashes*; Minsky's instability hypothesis extended to *information* rather than *credit*).
- Key variables governing the equilibrium: **detection cost, punishment probability, interaction frequency, and information verifiability.** Anything that lowers detection or verifiability shifts the equilibrium toward deception.