Editor's note: Today's edition from our master trader Jeff Clark is a bit different from our usual fare. While Jeff is better known as a fountain of great trading ideas, he's also a great political satirist… and his work in this space always generates plenty of reader feedback. We've no doubt today's commentary will continue the tradition…
Tuesday, October 26, 2010
"So, we're in agreement?" asks the Mad Hatter as he stands in the center of the Oval Office. All the costumed figures in attendance nod.
"Great. Get in here, then." The Mad Hatter ushers them all into a huddle. Everyone puts their right hands in.
"OK, let's hear it. QE2, on three. One... two... three... "
"Q! E! 2!"
The shout rattles the windows of the Oval Office and startles the guests out in the waiting room. They're bobbing for apples and complimenting the Queen of Hearts on how lovely she looks.
"Let's get back to the party," laughs the Mad Hatter. All the costumed figures leave smiling and snickering with a degree of confidence lacking at the meeting's start two hours earlier...
Two hours earlier...
"This can't be happening." The Mad Hatter slammed his fist down on the desk and pointed a trembling finger toward the clown hiding behind the flag in the corner. "This is all your fault," yelled the Hatter. "You had this problem before I even got here."
The clown shrugged his shoulders, honked his nose, and squirted water from the small American flag pinned to his lapel.
"Come on people," the Mad Hatter turned to address the rest of the room. "The election is in three weeks. We need to get the American people on board with us or we're all screwed. Any ideas?"
The donkey in the middle of the room raised his hoof.
"Whatcha got, Harry?" asked the Hatter. "It's the first idea you've had since you were elected to the Senate 26 years ago. So make it good."
"Sorry, sir," said the donkey. "I just need to go to the bathroom." He trotted out the door and never returned.
"I have an idea," blurted a round-faced, mustached gentleman dressed like Dorothy from the Wizard of Oz. "Let's do the helicopter drop thing again. This time, though, instead of dropping all the money on Wall Street, we can fly over other parts of the country so the money actually makes its way into the economy."
The room erupted in laughter.
"Ben," said the Mad Hatter, "you're a moron. We're not in Kansas anymore. The whole idea is to get money into the pockets of the bankers. This foreclosure crisis is about to blow sky-high. If we don't find a way to bail them out soon, they'll never be able to finance our campaigns. We'll be booted out of office. We'll be stuck standing in line for food stamps like everybody else. Now, get with the program or I'll get rid of you... and your little dog, too."
Toto lifted his head and growled. But what could a little puppy do? He mumbled something about a strong dollar policy and then laid his head back down on Dorothy's lap.
"How many times do I have to tell you the same thing?" The Grim Reaper rose from the couch and waved his scythe at the crowd. "Never let a good crisis go to waste."
"It seems to me," he continued, "there's only one group the American people distrust more than the bankers."
"That may be true," interrupted a short, frumpy figure dressed as a scarecrow. "But how are we going to pin this on the Republicans? They're not even in power anymore."
"I'm not talking about the Republicans, Hillary," the Grim Reaper replied. "I'm talking about the Chinese."
"Ahh," the crowd sighed, recognizing the brilliance of the idea.
"They're currency manipulators!" barked Toto.
"That's right!" yelled the scarecrow. "And they dump their products onto our markets."
"That's right!" repeated a figure wearing a Dick Cheney mask. "And they dump their products onto our markets."
"For crying out loud, Joe," the Mad Hatter grumped. "Hillary just said that."
"Sorry, sir," Joe replied. "Force of habit."
"Rahm is right," said the Mad Hatter. "We can say all our problems are caused by China manipulating its currency. We'll tell them the only way to combat that threat and avoid another Great Depression is through another quantitative easing program. We'll give the new money to Fannie and Freddie. They'll buy up all the questionable mortgage-backed securities investors are threatening to force back on the banks. The banks will be off the hook. We'll get our campaign contributions. And we'll kick the ticking time bomb down the road another generation or two."
"Do you really think the American taxpayer will go for it?" asked Dorothy.
"Sure," replied the Hatter. "We'll just label the Chinese currency peg a 'financial weapon of mass destruction.' The taxpayer will let us do anything we want to after that. Right?"
The clown behind the flag shrugged his shoulders, honked his nose, and squirted water from the small American flag pinned to his lapel.
"Alrighty then," continued the Mad Hatter. "It's Q-E-2 on three. Ready? One... two..."
Best regards and good trading,
For another spooky story, read Jeff's take on the S&P 500's rally last month. "Jason, Michael Myers, and Freddy Krueger never attack when there's a crowd around," he wrote. "And stock markets never crash when everyone expects them to." Read more here: Get Out of the House... NOW.
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