Suddenly what was discounted as a potential “isolated event” has come full circle to show just how contagious it may very well be. e.g., Greece.
Over the last few months the financial media has not only turned deaf ears to the drama, (out of boredom) they have also blindly discounted any contagion effects as “isolated” at best – relative periphery contagion at worst. In other words: Any and all problems can be contained, mitigated, or solved by none other than your friendly neighborhood Central Bank. After all, if you listen to the so-called “smart crowd” these bankers have powers even Zeus would envy.
So why worry about a little turmoil at the foot of Olympus? After all, the gods haven’t been seen nor heard from in millennia. Central Bankers give press conferences live and in person. Thunder vs a press conference? No contest in today’s role for proving omnipotence. All one needs to remember for proof is Mario Draghi’s now famous chortle of “having a bazooka and willing to use it.”
However, just as in any hero-worship endeavor one thing must remain constant or it all falls apart. Those that worship can never witness any event regardless of how minor: that the gods are not all that they portend to be. In other words: Allow just one moment of truth to be witnessed showing frailty instead of omnipotence – and the whole ruse falls regardless of the size and strength of the monuments and temples built to honor. For they will be abandoned. Sometimes slowly. At others: all at once. It doesn’t take much.
A great analogy to express this was portrayed in the movie sequel Iron Man 2 (2010 Paramount Pictures) when the characters played by Mickey Rourke, and Robert Downey Jr. are conversing in a cell about the who, what, and why of Rourke’s rampage at the speedway. Everyone in the room seems content with the idea or fact they contained or stopped Rourke’s character Ivan Vanko in his tracks. Yet, as Rourke explains to a mystified Tony Stark played by Downey. He had already won and it was Stark who didn’t understand as he explains: [laughs] “If you could make God bleed, people would cease to believe in Him. There will be blood in the water, the sharks will come. All I have to do is sit back and watch as the world consumes you.”
This onerous theme as well as implications just might be playing out in Greece. Only this time, it’s not in a fable, or on the big screen. Rather – it’s in real-time with real consequences for the financial markets as a whole.
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