Monday, August 8, 2011

... As The Global Financial Community Dissolves Into Farce

The past 48 hours have seen such screaming, wailing and gnashing of teeth in the global financial markets as hasn't happened since the Great Depression.  Gloom, Despair and Agony!  It must certainly be The End!  Television commentators clench their microphones in white-knuckled grip as they stare with horror at the floors and pits of the world's trading centers, awaiting the moment when surely the entire structure will begin to melt before their very eyes!!!

And then, in the midst of it all, a discordant note, so small, so slight, so overwhelmed by the cacophony of dismay; yet, just barely, still discernible.  'midst the flood of Global Panic, comes the sound of ...... laughter?

Oh.  I'm so sorry.  That would be ..... me.

Yes, me - laughing.  Laughing hysterically!  At every mention of how dismal are US stock futures, the news that Israel's market actually had to CLOSE because its index dropped 6%, the cold-sweat dread which anticipated the opening of the Asian markets - I was laughing harder and harder.  The whole situation is just so comical!

How dare I, say you?  How do I justify this outrageous mirth?  Well, that's fairly asked, I suppose.  And the reason is, simply, the whole thing is just absolutely, delicious FARCE!!  It really is just too amusing to watch the reaction to this pronouncement, especially as well-telegraphed and widely-expected as it was.  Oh, you understand not from whence my humor springs?  Am I some cold-hearted cad, you ask, that I take delight in the misery of Big Finance?  No, no, no, not at all.  I take absolutely no delight in the misery of others.  (Well, that Iranian fellow, Ahmadinejad - I wouldn't cry many tears if I knew he was miserable.  But aside from him?  Nooo, no, not really.)  Follow my thought process (if you dare!), perchance you will understand.

Can we all agree that the US economy is perhaps the most closely monitored in the world, the T-Bill perhaps the most widely purchased?  Yes, yes, I know, other economies are certainly closely watched - the European Union, Russia, China, Japan and probably others, certainly have a great deal of influence.  But the US of A's has long been the dominant economy.  And so, the problems facing our nation in terms of the recession, near-term deficit and long-term debt are all well-studied, well-known and well-understood by anyone who has any knowledge of global markets.  US markets had a very bad week, to be sure - especially Thursday, with its 500+ drop on the Dow-Jones Industrial Average - but it certainly appeared on Friday that there were, after all, cooler heads.  That is, until 8pm Eastern Time that evening.

That is when Standard and Poor's released their statement that The Emperor - as played by Uncle Sam - while not at all nekked, really should have better to wear than jeans and a t-shirt.  Meanwhile, the other two main rating agencies, Moody and Fitch, averred that the jeans were of a high quality material, and the t-shirt did have a nice print of an American flag, after all, and they apparently are not at all concerned.  But 'twas the damning review by S and P that wrought such anguish!

Think of it - had any numbers changed between the time the US markets closed on Friday and the mid-East markets opened on Sunday?  Absolutely not!  But that one pronouncement by one rating agency was enough to trigger a panic that would have bewildered Chicken Little, and it has fed upon itself until this point, at the very least.  As I write this, it is just after midnight in the Eastern US.  The Asian markets are taking losses, but not - yet - as serious as had been feared.  European markets will open in the next few hours, and hopefully the brokers of filthy lucre will have had time to consider the situation and shrug it off.  If so, I shall be glad, for I do recognize there are consequences to be considered.

If not, well, then I shall be mirthful still, as I observe the panic brought about by the pronounced judgment, from the least of the three most-watched credit agencies, that America's gold standard has a wee bit of tarnish.  Goodness, Chicken Little really does look jealous, don't you think?