Skip to comments.Hitchhiker's Guide to the eurozone crisis
Posted on 03/02/2012 9:19:32 PM PST by bruinbirdman
What if the euro crisis were merely a devilish experiment set up by a gigantic computer disguised as Planet Earth? The Berlin cabaret artist Horst Evers runs though the euro crisis but by the rules of Douglas Adams alternative universe. And he finds the human race isnt quite up to their job.
In Douglas Adams' novel The Hitchhiker's Guide to the Galaxy, the Earth is a kind of gigantic computer built by a higher intelligence to ponder the eternal questions of the universe. This higher, extra-terrestrial intelligence is therefore constantly setting up tricky and complex experiments to test mankinds skills and level of development.
If this conjecture by Douglas Adams were true that is, that this is the deeper meaning of human existence then our handling of the euro crisis would probably be setting us back many, many places in the interplanetary IQ rankings.
For months now the eurozone has been stepping again and again through the same hoops of the experiment at ever increasing speed and rising panic.
Hoop 1: The eurozone states determine that the measures taken thus far are vastly inadequate, the demand for money significantly higher than expected, and the situation even more critical than assumed. Thus follows -
Hoop 2: A summit is called, where a solution absolutely must be found and a breakthrough made. The seriousness of the situation is stressed: there are no second chances, there must be no more mental taboos, and to please the media, the leaders claim to be speaking merely the plain truth. From this there necessarily follows -
Hoop 3: Rigid austerity measures are brought in swingeing cuts and drastic programmes that will get a stranglehold on the debt and guarantee its all paid back. Cue to smooth transition to -
Hoop 4: The hard line is regretted, but the will to take unpopular measures is praised: no more living beyond our means. The stock markets breathe a sigh of relief, countries in debt feel humiliated and led around by the nose but they go along with it, which is taken as a great success and a real breakthrough. Very soon, however, there begins
Hoop 5: Economic experts worry that the slashing cuts and austerity measures will put real brakes on the economy. The economies of the eurozone will suffer dreadfully, if indeed they dont collapse entirely. The experts quail before the fearful prospect of a recession, and so there follows
Hoop 6: Surprisingly, the rating agencies share these worries. Despite the harsh austerity measures, they do not feel too good about the way things are going not too good at all, gentlemen, which is why, tragically, they see no other option but to revise their forecasts and ratings for many eurozone countries and banks downwards. This leads to
Hoop 7: The costs and charges for more loans and other measures soar up again sharply, thanks to the glummer ratings. Confidence in the eurozone, especially in the out-of-pocket states, takes flight. Many banks have considerable problems on that account too. Slowly its grasped that the measures taken thus far are nowhere near enough, the demand for money significantly higher than expected, the situation even more critical than assumed which completes the leap through Hoop 1. Again we bend low and head directly to -
Hoop 2: A summit must be held...
Its difficult to wager whether that higher intelligence that set up this series of tests for us is amused or depressed. Theyre probably looking on impassively as mankind, especially the eurozone species, is continually trying to get off this hamster wheel using the same old methods. Lately theyve increased their speed and intensity, but otherwise theyre just bravely and unflinchingly following the same old reflexes.
Or perhaps the higher intelligence is already so bored that its simply ratcheting up the experimental conditions. And so its toughening up the stress test for the two main animals by, for one of them, placing a tough election campaign in his path and, for the other, inventing a scandal to brush aside a harmless President and bring a much more complicated successor into the game.
Perhaps there will soon be even more radical and more detailed proposals in order to pull off the rescue. It may be proposed to Greece that the country sell off its starting place in the European Football Championship to China. Eventually, other experts on Europe might even encourage Britain, for example, to be traded for China.
No doubt, there are many who want to help Greece. Provided, of course, that the Greeks send a token of their good will for example by signing away their entire country, their entire work force, their entire economy to their creditors, and for the rest of time. Maybe Europe will even get a rating agency of its own off the ground, or maybe even a rating agency for rating agencies.
In Douglas Adams book the questions of the universe dont get answered. On the contrary, the giant computer Earth, in order to make way for a hyperspace bypass, gets blasted out of the galactic road. Such measures would, however, certainly be an exaggerated way of tackling the euro crisis.
Translated from the German by Anton Baer
After the close, Moodys downgraded Greece to C. As you know, C means D, as in Default. Losses to creditors after the current tranche of funds are estimated at 70%.
I wonder who talked Moodys into giving investors all weekend to digest this news?
So is the CDS DOOMSDAY MACHINE going to be triggered?
Now Draghi is printing euros, that has changed ;-)
Crisis under control. On dancers: Banks, States, Banks...
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