Woe is unto the world. It doesn't know whether to shit or go blind. The rule of law has been replaced by Murphy's Law. The story in Greece gets more and more curious. One of the latest proposals is to ask holders of Greek bonds to go along with a voluntary rollover, meaning we will pay you on Tuesday for a hamburger today, even though we already owe you for ten years of weekly hamburgers.
Odd how the financial innovation never ceases. This last great new idea: that bonds never really have to pay off, will do wonders for the bond market everywhere. People will clamor for bonds that come with no clear terms and probably no redemptions. Now, the buzz around the cosmic meme-sphere is saying fuggedabowt Greece, we're gonna do the same thing with Portugal and its sillyass bonds. Enter China.
Europe is about to enjoy the greatest monetary Chinese fire drill ever staged. Wen Jiabao will wave a magic wand and the Euro will fly above mundane reality on dragon wings allowing everybody in Greece, Portugal, Spain, Ireland, and Italy to hold a senior management job at the motor vehicle bureau with retirement at 53. Then, with 80 percent of their former pay, they can open cafes where people still working at the motor vehicle bureau can spend the better part of each afternoon sipping Ouzo and arguing politics, finance, sports... or just enjoying the antics of the boorish German tourists.
Meanwhile, Goldman Sachs's man in Europe, Mario Draghi, will take a seat in Jean Trichet's big chair at the European Central Bank around November of this year. It was Goldman Sachs, apparently, that erected a giant credit default swap house of cards for Europe to live in happily-ever-after - except in the event of a default accident, in which case Goldman Sachs would receive all the money ever printed on God's green Earth, plus commissions, premiums, penalty payouts, interest, and bonuses... and homeless Europe would then be welcome to take a flying fuck at a rolling donut - or make that a strawberry Bismarck! Personally, I don't see how the various players can delay some sort of crisis until November. The European currency experiment is a bust and too many big banks are just plain insolvent. Can Wen Jiabao launch another flying dragon that seeds the European skies with counterparty payoffs that will rain down from Dublin to Athens and keep everybody happy?
Don't get the idea that the USA can just occupy a grandstand seat and stuff its fat face with Cheez Doodles while the current act plays out in the center ring of the world financial circus. Plenty of intermingled American interests depend on how things work out over there, not the least of which is the fact that the International Monetary Fund is actually a proxy American bail-out operation. It worked just fine in the old days when its exertions focused on little urchin nations like Swaziland, but wait until the Tea Party hears that America runs twelve thousand cafes for European motor vehicle bureaucrats to while away the afternoons drinking Ouzo in. (At least maybe we can get them to drink Old Mr. Boston anisette liqueur instead.)
It does prompt one to think we might try something like that here. Would it not improve the national character generally if our citizens spent more time arguing politics in cafes than lying on the couch watching a TV figment named "Snooki" throw standing crotch-locks on every unemployed forklift driver in the mythical kingdom of New Jersey?
If I were Barack Obama, I'd think twice about presiding over this irresolvable muddle of engineered swindles, sinking prospects, booby-trapped budgets, and played-out lies for another term. Let Hillary step in and try to keep this leaky Flying Dutchman out of the drink. She's looking more and more like Winston Churchill physically every day now, anyway. Maybe she is acquiring something like his stolid habits of mind, too. If I were President Obama, I'd just call it quits and sign on with the home team: Goldman Sachs. He can have Mario Draghi's old job - chief of the international division. They'll love him in all those peculiar little countries where people wear hats that look like rat-traps and flavor their beer with the cocoons of nectar-sipping moths. They'll enjoy it when he forecloses on them, and maybe even ask for more. "Here, take our grandchildren's baby teeth, too!" I wish him and his beautiful family well in their new life as distinguished private citizens-of-the-world. I just hope Michele Bachmann and her probable running mate, Jesus, don't steal the next election. They'll rip out the Obamas' vegetable garden and put a Nascar track there so that all of Ms. Bachmann's 27 children can have jobs selling miniature bibles in the parking lot. ("Prayed over by qualified preachers twenty-four hours a day!")
By the by, many observers were amused by last week's cute trick of releasing sixty million barrels of oil from the world's strategic reserves at the rate of two million-a-day in an effort to pretend that the world doesn't have a basic oil production problem. It is, of course, at the bottom of the world's financial disarray, because if you can't increase energy inputs that feed an industrial economy you don't get growth and then the whole idea of compound interest falls apart because it is predicated on a perpetual increase in wealth. Hence, debt collapses in on itself. The world is caught up in an epochal contraction now, and it manifests in situations like the Greek emergency. But soon it will be a universal emergency.
The lesson, if I may be tendentious for moment, is that the human race is welcome at any time to begin living differently, at a smaller scale, much more locally, with fewer automatic machines doing all the work for us, and more time spent on useful and necessary activities than on television fantasies. Got a problem with oil? Don't imagine that you're going to run WalMart - or, for that matter, Goldman Sachs - on wheat-straw distillates. Something is in the air this week and it is making a lot of people very nervous. If you loaded up the old investment portfolio with shale gas stocks, I feel especially sorry for you.