Project for Philosophical Evaluations of the Economy |
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The rough patch seems to be over
Dialog with the Alter Ego on the Greek debt crisis, first drafted on June 29, published on June 30, 2011
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Question by Alter Ego of Noah denkt™ (AE): A couple of weeks ago, you correctly predicted the rough patch that
the economy has been going through these days. Do you have any visibility yet as to how much further down the
markets will be going before things can get better?
Answer by Noah denkt™ (Nd). We believe that this is pretty much it.
AE: Why do you say that?
Nd. Because it seems to us as if the magic formula has been found by which the debt restructuring in Greece
(and perhaps elsewhere) can be dealt with in a non too disruptive manner.
AE: So you no longer presume that we will have to go through a double dip before the market can truly climb out
of the hole that it has been digging for itself throughout?
Nd: For quite a while we did in deed think it possible that a major correction might be in the works here. We have
come to the conclusion though that it is still to early for a W-shaped pattern to emerge.
AE: You continue to believe though that a bigger correction will eventually come?
Nd: Absolutely.
AE: Let’s come back to the magic formula that arguably has been found in the debt restructuring process in
Greece. What formula is this?
Nd: It is the idea of combining the next leg of the bail-out with a re-profiling of the corresponding debt on the basis
of a voluntary participation by creditor banks. We think that this mix of initiatives might do the trick for all of us.
AE: And do you think that banks will in deed participate in this?
Nd: Well, the French and the German banks have apparently signalled that they are willing to play along.
AE: Does Noah denkt™ believe that this formula might equally work for a debt restructuring in Ireland, Portugal
and elsewhere?
Nd: If politicians get the timing right, and if they continue to adjust their decisions according to the evolving facts
on the ground they may in deed have found the solution to wiggle us out of the current mess.
AE: In other words, you still trust the crisis management capabilities of the European politicians?
Nd: Correct.
AE: And you do not think that they have been slow to address the core of the problem and that they have wasted
precious money just trying to buy time?
Nd: Not at all.
AE: Why do you say that?
Nd: Because it takes time to find the best possible solution for a problem. It takes time to find the right moment for
a debt restructuring. Because if you do it too early the relief that is associated with it, will not be appreciated
enough in order to unleash the public’s entrepreneurial energy.
AE: What do you say to those who find that the crisis management of EU leaders has been messy, contradictory
and ineffective?
Nd: We would tell them that democracy itself is messy, contradictory and wavering just as much as the human
mind is unsure, eclectic and dithering at times. But that doesn’t mean that both are doomed to fail. Much rather
it’s the opposite that is true. In fact, the wavering, the dithering and the wobbling are a prerequisite to getting the
big decisions right. Because it is this step-by-step approach that gets you as close as possible to the eye of the
storm. And it is there and only there where you can in deed develop the best possible intuition for resolving the
impending matter.
AE: So you are saying that democratic crisis management is very much like good sex. Because there too you
have to take it slow and easy in order to get where you ultimately want to be.
Nd: You could put it like this.
AE: If all that’s true why then do market participants keep crying “foul” about the politicians’ handling of the crisis?
Nd: Because they do not have the nerves to stand the pressures that all those who truly want to get things right
have to subject themselves to
AE: In other words, we continue to side with the gutsy and the strong who, as it happens, turn out to be the best
lovers too?
Nd: So be it.
Dialog with the Alter Ego on the Greek debt crisis, first drafted on June 29, published on June 30, 2011
----------------------------------------------------------------------------------------------------------------------------------------
Question by Alter Ego of Noah denkt™ (AE): A couple of weeks ago, you correctly predicted the rough patch that
the economy has been going through these days. Do you have any visibility yet as to how much further down the
markets will be going before things can get better?
Answer by Noah denkt™ (Nd). We believe that this is pretty much it.
AE: Why do you say that?
Nd. Because it seems to us as if the magic formula has been found by which the debt restructuring in Greece
(and perhaps elsewhere) can be dealt with in a non too disruptive manner.
AE: So you no longer presume that we will have to go through a double dip before the market can truly climb out
of the hole that it has been digging for itself throughout?
Nd: For quite a while we did in deed think it possible that a major correction might be in the works here. We have
come to the conclusion though that it is still to early for a W-shaped pattern to emerge.
AE: You continue to believe though that a bigger correction will eventually come?
Nd: Absolutely.
AE: Let’s come back to the magic formula that arguably has been found in the debt restructuring process in
Greece. What formula is this?
Nd: It is the idea of combining the next leg of the bail-out with a re-profiling of the corresponding debt on the basis
of a voluntary participation by creditor banks. We think that this mix of initiatives might do the trick for all of us.
AE: And do you think that banks will in deed participate in this?
Nd: Well, the French and the German banks have apparently signalled that they are willing to play along.
AE: Does Noah denkt™ believe that this formula might equally work for a debt restructuring in Ireland, Portugal
and elsewhere?
Nd: If politicians get the timing right, and if they continue to adjust their decisions according to the evolving facts
on the ground they may in deed have found the solution to wiggle us out of the current mess.
AE: In other words, you still trust the crisis management capabilities of the European politicians?
Nd: Correct.
AE: And you do not think that they have been slow to address the core of the problem and that they have wasted
precious money just trying to buy time?
Nd: Not at all.
AE: Why do you say that?
Nd: Because it takes time to find the best possible solution for a problem. It takes time to find the right moment for
a debt restructuring. Because if you do it too early the relief that is associated with it, will not be appreciated
enough in order to unleash the public’s entrepreneurial energy.
AE: What do you say to those who find that the crisis management of EU leaders has been messy, contradictory
and ineffective?
Nd: We would tell them that democracy itself is messy, contradictory and wavering just as much as the human
mind is unsure, eclectic and dithering at times. But that doesn’t mean that both are doomed to fail. Much rather
it’s the opposite that is true. In fact, the wavering, the dithering and the wobbling are a prerequisite to getting the
big decisions right. Because it is this step-by-step approach that gets you as close as possible to the eye of the
storm. And it is there and only there where you can in deed develop the best possible intuition for resolving the
impending matter.
AE: So you are saying that democratic crisis management is very much like good sex. Because there too you
have to take it slow and easy in order to get where you ultimately want to be.
Nd: You could put it like this.
AE: If all that’s true why then do market participants keep crying “foul” about the politicians’ handling of the crisis?
Nd: Because they do not have the nerves to stand the pressures that all those who truly want to get things right
have to subject themselves to
AE: In other words, we continue to side with the gutsy and the strong who, as it happens, turn out to be the best
lovers too?
Nd: So be it.
| © Landei Selbstverlag, owned by Wilhelm ("Wil") Leonards, Gerolstein, Germany. All rights reserved. Reminder: Noah denkt™ is a project of Wilhelm ("Wil") Leonards and his Landei Selbstverlag (WL & his LSV). Consequently, all rights to the texts that have been published under the Noah denkt™brand name are reserved by WL & his LSV. The commentary and the reasoning that was provided on this page is for informational and/or educational purposes only and it is not intended to provide tax, legal or investment advice. It should therefore not be construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any security or any issuer by WL & his LSV or its Noah denkt™ Project. In fact, WL & his LSV encourage the user to understand that he alone is responsible for determining whether any investment, security or strategy is appropriate or suitable for him. And to leave no doubt as to what this means we urge our user to also note our extended Legal Notice. |
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| Keywords: debt restructuring in Greece, European debt crisis, crisis management in the EURO-zone, European crisis management, re-profiling of Greek debt, W-shaped recovery, double-dip recovery, double dip recovery, V-shaped recovery, strategy for crisis management |