All The World's A Stage

Tyler Durden's picture

Via Mark Grant, author of Out of the Box,

The Theatre of the Absurd
Mrs. Ethel Chauvenet: Does Elwood see anybody these days?

Veta Louise Simmons: Oh, yes, Aunt Ethel, Elwood sees “somebody.”
                   -The play, Harvey
Andrew Ross Sorkin once speculated that I was the next “Doctor Doom.” Anyone that knows me or that reads my commentary with any frequency would know that this is hardly my personality nor would I stir pots for the pleasure of watching the froth. Sometimes it is just that I can see the rabbit leaning on the light post before others even see the street corner upon which it is standing. Others may also see the lamp post but they are frightened to admit it because their leaders have screamed for so long that it isn’t there and will never be there; never mind any 6’3” pookah. However as the light is beginning to dawn and as the early morning shadows that played tricks with your vision dissipate; more and more people can see the vague outline of Harvey leaning against the lamp post and, startled by his presence or not, they can no longer turn away and pretend him out of existence.
“What can I do for you Mr. Dowd?
“What did you have in mind?”
The troika arrives in Athens tomorrow. The preliminary estimates of meeting the budgetary targets under the Memorandum of Understanding signed off on by the EU, the IMF and the Greek government indicate an achievement somewhat akin to an Olympian running down the track in the opposite direction. A novel approach, no doubt, but one hardly likely to win any race. The IMF and the German government over the weekend stated specifically that if the requirements were not met that no more money would be doled out while the Greek government said they would require another $50 billion to get them through September. The revolving stage of Europe is about to head back to Athens and we well may have reached the last act where the final curtain is pulled and the show is shut down. If this is the case then you may expect screaming, vile proclamations of betrayal and all manner of scathing statements to be issued forth from the plains of Marathon. In the end, whether Greece remains in the Eurozone and retreats to the Drachma and receives some kind of debtor-in-possession financing or not it will mean that Greece will default on a total of $1.3 trillion in obligations unless some deal is worked out so that Europe keeps some kind of funding so the $238 billion of Greek obligations at the ECB does not default which would wipe out the equity capital at the ECB and require Europe to recapitalize the European Central Bank amid all kinds of shouts of dismay. It will be interesting, one might speculate, when Finland asks the ECB for collateral and one can only hope that they do not offer either the securitizations of Greece or Spain as the off-set.
As we are all captivated by the farce at the Parthenon I invite you to step across the street and watch the “Masquerade of Madrid” where the leading character declares a “Great victory for Europe” as his country sinks into the Mediterranean Sea. The money for the Spanish banks will be going to the sovereign and the Men in Black will dictate the terms of the $125 billion dispersal. The regional debt of Spain is equivalent to the national debt and with $36 billion in regional debt maturities coming due before year end and a national fund of only $19 billion the math employed by Mr. Rajoy is the usual European tricks of Trigonometry. As the yield on the Spanish ten year catapults to 7.40% this morning in London and as each region in Spain climbs on the national debt wagon for relief one may expect continuing antics as the Prime Minister declares that the regional debt problems will not affect the debt to GDP ratio of the country. It is an old story in Spain where windmills are fought but I fear that romantic comedies will not be enough this time to placate those who will be called upon, in the spirit of brotherly love, to fund the nation.
The bank and regional debt problem is one the size of $350-400 billion in the fourth largest economy in Europe while their 12% contribution to the EU, the ECB and the stabilization funds will soon no longer be made I surmise. It is a squared problem then you see and a vindication of the notion that firewalls and fences do nothing to improve the health of the horses that are inside the corral. The animals are sick, infected by their own exacerbated standards of living which they can no longer fund internally given declining revenue bases as virtually every country in Europe, besides Germany for the moment, falters in recession. Hence you hear the cries and screams and the gnashing of teeth demanding that Germany picks up the bill but the size of the German wallet is not up to the task with a $3.2 trillion dollar economy that can only withstand so much.
The theatre season is sure to be a hit this year with revivals of Ireland and Portugal while the excitement continues in Athens and Madrid and the sets are alive with the “Sound of Music” though the tunes will vibrate to something in Heavy Metal and not to the sweet melodies of the Alps in July. It was a year ago when I predicted a U.S. Treasury ten year of 1.25% and we are but a scant 16 bps from that now. The Euro is now under 1.21/Dollar and there are negative yields in the short maturities for Germany, France and the Netherlands which I predict will soon be found in the United States. I am not sure what Mr. Bernanke will make of institutions paying him to leave their money with the United States government but it will be a classic example of a point in time where “Return OF Capital” became much more important that “Return ON Capital” but as I have asserted time and time again, given the 36% loss of wealth during the American Financial Crisis, that “Preservation of Capital,” Grant’s Rules 1-10, are manifestly the byword of the Faith at present.
The European Union has been, in a very real sense, like a masquerade ball. The intricately painted masks covering manipulated stress tests, hiding inaccurate debt to GDP ratios, falsified accounting practices, glossing over any sort of contingent liabilities as if the scars were not there and double counting assets however, like all extravaganzas of this type, is about to reach a conclusion. The night has been long and the hour is late but one by one the masks are being removed and the characters are seen for what they are; a less than pretty sight.
“Too late for prayers and useless pity.”
                    -The Phantom of the Opera

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
fonzannoon's picture

Andrew Ross Sorkin once speculated (stop reading here)

bigdumbnugly's picture

dam i was waiting for a pearl of wisdom.

Precious's picture

Now that we have naked rider bicycle rallies, you can be certain that no one is embarrassed about anything anymore.

NewThor's picture

If the whole world is a stage, then everything is just a prop.

Pladizow's picture

If all the world is a stage, who's in the audience?

engineertheeconomy's picture

Everthing in the entire world has been staged by a few select for over 100 years now

fixed it for you

knukles's picture

Andrew Ross Sorkin and Paul Krugman once speculated...

JR's picture

A pearl...

“I get so very weary of Andrew Ross Sorkin. He is just smart enough to confuse most people. But his last article, Reinstating an Old Rule Is Not a Cure for Crisis, in the NY Times has just gone over the line.

“Andrew Sorkin says that Glass-Steagall would not have prevented the meltdown in the housing crisis, because the banks that melted down were not commercial banks. They were investment banks not subject to Glass-Steagall rules. But what Sorkin left out of the article was that the credit default swaps were deregulated at the same time through the Commodity Futures Modernization Act. Phil Gramm had a hand in repealing Glass-Steagall. His wife, Wendy, had a major role in taking off the gambling stigma from CDSs.

The two went together. The swaps allowed the banks to hedge against risk whether they were commercial or investment banks. And the investment banks did not have access to this CDS insurance, in such a reckless manner, prior to the assault by the (Phil)Gramms. One couple deregulated the entire financial industry on the model of the UK Square Mile. After the self certified lending that was the first manifestation of liar loans, in the UK, the financial system used the (Phil) Gramms to bring liar loans and toxic destruction of main street to the US shores.

“The housing bubble was not an accident. It was premeditated…

“Sorkin is a schmoozer, and has schmoozed with the likes of Jamie Dimon and many of the big boys. You would have thought he would have learned something in all that schmoozing. But apparently he has not learned enough. Or maybe he has learned too much. If you chip away at the comprehensive puzzle needed to rein in the banks and investment banks, piece by piece, pretty soon you have no way to stop the bankers!” – Gary Anderson, May 24, 2012, Business Insider

Read more:

azzhatter's picture

Oh my, I am so interested to hear what little punk fuckstick Sorkin will bloviate on

DoChenRollingBearing's picture

Maybe it's time to take a break from all the bad news.  I have collected some music that most of you have probably not heard before.

Freegold music?  Peruvian mountain music (very pretty).  Popular Peruvian music.  If you need a break, take a peek:

Spitzer's picture

The Euro hate-on continues... Its wierd that even most Austrians hate the Euro more then the dollar.

The government net borrowing of the Eurozone as a whole amounts to only 11% of total government expenditures. In the Dollarzone, its north of 20%

janus's picture

me gusta la musica....especialmente la pasa condor; me encanta con esa.

have you ever seen a movie called Agurre Wrath of God?  I think you'd like epic done in a novel and surreal style by one of the world's finest (if not THE finest) film makers -- werner herzog.

in fact, i would recommend all of his movies.

vaya con Dios,


DoChenRollingBearing's picture

Gracias!  Un verde!

Yes, I have seen Aguirre, fantastic movie.

Vaya con Dios también!

Concentrated power has always been the enemy of liberty.'s picture

Drachma, Bitches!  Oupa!!!!!

zero19451945's picture

I don't sense a lot of panic with the Dow well above 12,000 and not even down 2% today. In fact, I wouldn't be surprised if we closed down less than 1/2% or even green.

I think the only people seeking "Return of Capital" are incompetent fund manager intentionally losing money for their clients. They should be fired and brought up on criminal charges if appropriate.

bagehot99's picture

Incompetent fund managers aren't purchasing boatloads of 2Y Swiss debt with a negative yield. But somebody is. So preservation is the order of the day, at least for those with much to lose.

For people in debt, a beautiful thing is about to happen.


buzzsaw99's picture

that last paragraph is so wrong. fund managers buy whatever has the biggest kickback. they don't care a flying fig if they lose money. only people who care about getting their money back are managing their own.

Qualitative Tightening's picture

So put your money where your mouth is and buy and hold this market for the next 6 months. I am right behind you.

RSloane's picture

I also don't sense a lot of panic, and I would not be surprised if we ended the day in the green. The DJIA is not connected to reality in any way; its completely based on perception which is bouyed by some remote possibility that the Fed will save the market's ass[es] once again, or at the very least continue to save it. The more people talk about recession, the more irrationally jubilant the market becomes. If Bernanke were to say: "I'm done, sink or swim on your own", then we would see panic, fear, and a steep downward trajectory.

DJIA is now at 123.29 at the time of this writing, which means its well off its lows. Given the current irrationality that passes for market wisdom, that will be interpreted as "we are winning!!!".

Overfed's picture

Of course there's no sense of panic in the DJIA, robots and algos don't experience fear.

cougar_w's picture

Hey I just worked that theme up last Friday!

But it's okay if he riffs on my stuff. The more the better, I say.

bagehot99's picture

The mountains always look beautiful, until you're standing on the slopes and the avalanche starts.

ebworthen's picture

Harvey is my friend.

The pockets of his vest are stuffed with cash, and he has no debt.

Never One Roach's picture

"Where is the wisdom we have lost in knowledge?
Where is the knowledge we have lost in information?"


TS Eliot 

earleflorida's picture

'wisdom requires failures

failures enhance courage

courage builds endurance

endurance is serendipitous

serendipity is fostered by trivial pursuits

pursuits parlayed with  mistaken`d information

information is but failure refined knowledge

knowledge at its best is evolutionary

evolution can`knot be acquiescence`d

acquiescence tethered to a laissez faire dogma 

dogma's are the burial ground for wisdom and knowledge, basking in infallible status`quo purgatory'


JR's picture

The animals are sick, infected by their own exacerbated standards of living which they can no longer fund internally – Mark Grant

Actually, no. The peoples of Europe were cheated by the big banks corrupting and using politicians at every turn. To blame the people for trying to work and live under a world controlled by bankers is wrong.

The predatory financial sector has captured the peoples’ political systems; it’s an “inside job” of private gains for an unregulated financial industry at public loss. It was not an accident.

Totentänzerlied's picture

500 million EU citizens versus a few thousand bankers, politicians, and beaurocrats? You're damn right it was no accident, they begged for it.

JR's picture

"500 million" Oliver Twists saying: “Please Sir, I want some more”? … more corruption, more cheating, more tyranny, more loss of sovereignty, more stolen home equity, more foreclosures, more price increases, more taxes, more bailouts for the bankers, more customer fraud, more laundering of drug money, more political deregulation of derivatives, more predatory loans, more national ponzi schemes, more 33:1 taxpayer-backed leverage risk, more unbacked Credit Default Swaps, more government debt, more global governance, more bought politicians, more trillons for the bankers and poverty for the people...

Ah, the numbers game. – 1 Mao Zedong versus 1 billion Chinese saying: “Please Sir, I want some more.”

 Have you ever been in a contest with a bank, with a Mao?  Mao in his Great Leap Forward's genocide of up to 70 million people wanted to destroy Chinese family culture. Fast forward ... the goals of the European banking cartel have frighteningly similar objectives.

When you’re up against tyranny, up against the sheriff, he wins. Who’s controlling Europe now? Is it the "500 million" souls or the innocent, misunderstood handful of well-meaning bankers?


fonzannoon's picture

I am pretty sure I read on ZH that the S&P was at the SAME EXACT place last year as it stands today. Thats bananas.

Duke of Con Dao's picture

I'll fret and strut my hour upon the stage - actually 70 seconds - with this vid mash I cooked up:

YouTube - "Howard Roark, You Didn't Build That!" says President Obama



twocents's picture

Finally! Bring it on so we can all move on.

Prediction: They will arrive in Athens tomorrow to find a bankrupt toilet, a load of excuses, missing money and pleas for more.

Maybe now people will see the Euro for what it is - a Ponzi scheme.


DaveyJones's picture

speaking of Harvey, here's another insane actor 

Dr. Engali's picture

I'm tired of that fossil. Banks have picture perfect earnings my ass. Even a little bit of homework can see through that bullshit. He needs to be run out of town.

apberusdisvet's picture

The current situation is morphing into the combination of a TwilightZone episode and The Matrix.  Nothing is as it seems; am I awake or dreaming?  Mind control?  MK-ultra?

I watched the first court episode of many concerning the Batman killer.  Sure looks like he just may be  another programmed patsy.

JamesBond's picture


I played the role of Elwood P Dowd last year at Theatre Albany.  This brought back great memories.

"He is a Pooka.  He is also my best friend."


Downtoolong's picture

Harvey leaning against the lamp post


A man was walking down a street one night when he spotted another man crawling on his hands and knees under a lamp post. The first man stopped and watched him a moment. Then, as his curiosity overcame him he asked, “Why are you crawling on the ground?” The second man replied, “I dropped a quarter over there by that bench.” More curious than ever, the first man then asked, “If you dropped a quarter by the bench, why are you looking for it over here?” The man on the ground replied, “What are you nuts, this is where the light is.”


I tell ya, that Harvey is one sick joker.


overmedicatedundersexed's picture

 Downtoo long:the light joke is from sufi tales, such as a man sitting backward riding a camal wildly running down the street, is ask where are you going? he yells I don't know but look how fast I am getting there!

o-antonio-maria's picture

"The regional debt of Spain is equivalent to the national debt" --WHAT ? NOT TRUE !

Public debt —State, rgions and municipalities (2011) : 734.962.000.000€ ; 68,5% of GDP
Regions debt (2011):€ ; 13,1% of GDP

janus's picture

great work, M Grant.

seems to janus we may be leaving absurdistan and entering kafkaville.


Dead Canary's picture

He who begs first, begs best.

Miles Kendig's picture

H/T to the Right Reverend Mark Grant for asking; Have you seen the light.

Who cares what the book of Sorkin has to say on the matters at hand anyway?

BlackholeDivestment's picture

...that was a pleasure to read. It read like Django playing Nagasaki after the Sumo fight, and one too many pulls on the tap.