Ben and Alan

I was reading a piece in the Wall Street Journal today about the impact of the Federal Reserve’s approach to inflation on developing economies. It was absolutely fascinating, with one exception. I didn’t understand a goddam word of it. When I was at business school, I took a course called Business, Government, and the International Economy (pronounced, I shit you not, Biggie). We spent much of that course, the part I never understood, discussing international monetary policy. Now, before you bail out on this blog because I’ve already used words like “international monetary policy,” let me be really clear: this is important stuff. This is what determines whether nations rise or fall, the global price of oil, how much you’ll pay for a Venti Carmel Macchiato with Whip at Starbucks. OK, now I see I have your attention now.

For years, I’ve been studiously reading every article in the business press about monetary policy and its impact on the global economy (and the price of high calorie caffeinated snack drinks). And, despite way too much post-secondary education, I simply don’t get it. As Al Pacino said in Scent of a Woman, it’s too damn hard. By the way, other than the courtroom scene in A Few Good Men or the group therapy scene with Dr. Evil in Austin Powers, is there any better monologue in a movie than Pacino’s diatribe against the Baird School at the end of Scent of a Woman. But, I digress. Anyhoo, I used to be really frustrated by my inability to fully understand the mechanistic impact of quantitative easing, in constant U.S. dollar terms, on the price of bananas in Rangoon, priced in Myanmar Kyat. Not anymore. Why not? Well, it hit me today. Ben Bernanke doesn’t understand it any better than I do. Neither did Alan Greenspan. They just know how to use fancier words.

As I got to thinking about this, and feeling much better about the 17 years I wasted accumulating degrees after high school, I envisioned a quiet evening with Ben and Alan. I imagine the conversation going something like this.

“Hey Alan”

“Yes, Ben, what is it?”

“I’m frustrated.”

“Why?”

“Well, can I be really honest with you?

“Of course, Ben. You’re not honest with anyone else so it would mean a lot to me.”

“OK, here goes….do you mind if I lie down on your couch first?”

“Please, Ben, make yourself comfortable. Would you like a drink?”

“Sure – something stiff please.”

“ANDREA – get Ben a single malt! On the double!  Ben, please go ahead.”

“OK, Alan, this is tough for me to say, but I don’t understand any of this shit?”

“What shit, Ben? I don’t follow you.”

“Well, this monetary policy shit. I mean, I go testify to Congress that easing the money supply will spark job growth and feed the G7 economies without risking any technical inflation. But, but, I really have no effing clue what any of that means.”

“Go on, Ben. I’m listening.”

“Well, Alan, when you were Fed Chairman, you seemed to really know what you were doing. People looked up to you. Well, at least until you blew up the entire US housing market.”

“Easy, Ben, we’ve talked about that.”

“Sorry, I’m just wondering – how did you understand all this stuff? It’s just so damn complex!”

“Ben, you think I understood it?”

“You didn’t?”

“Hell no! What are you talking about, Willis? You think I actually had any idea what the impact of the Federal Open Market Committee moves would be on long term bond rates. Bra ha ha ha. You’re more naïve than I thought!”

“Seriously, Alan, you don’t understand how capital velocity impacts short term rates in third world nations who use a dollar denominated basket of goods to determine their currency value?”

“Dude, I don’t even know what the fuck you’re talking about. But, you’ve got the buzz words down and, trust me, with those morons on Capitol Hill, that’s all you need.”

“Really? That’s fantastic. I really don’t need to understand any of it?”

“Nope. I never did.”

“Oh, I’m so relieved. Will you have a Scotch with me?”

“ANDREA! MAKE IT TWO!”

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About Bruce Robertson

Bruce Robertson is an amateur writer and professional provocateur
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One Response to Ben and Alan

  1. Dan Grabois says:

    It has finally happened: I agree with you! When you get a minimum of two “experts” together and they disagree, that shows that their expertise is really just opinion. And looking at the morons populating our congress, it’s not hard to be certain that they have no understanding at all of complicated economic ideas. Just as I don’t, even though I have 2 years of graduate school on my resume as well (French horn performance, Master of Music – funny how they didn’t teach us that “basket of goods” thingy).

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