ON THE SLIPPERY SLOPES

One of the must do things for those interested in the state of international finance is to get ahold of the academic papers produced for the pow-wows at Aspen and Jackson Hole.  All are really good; some wonderful.  Not a one has any applicability to the real world.  That is not a bad thing because even academics need employment  but one wonders whether a simple transmittal by electronic mail, fax or, if trusted, the U.S. Postal Services would have sufficed.  Would have been a hell of a lot cheaper but then again, academics have never really be concerned about cost when they themselves are involved.

I am told, and obviously I do not know this for certain, but contrary to what the popular press and the talking heads would have one believe, the is a great deal more concern as to the state of play involving the various QE schemes that abound and in particular how the devil the developed world's central banks are going to get themselves out of what some are beginning to call a tar pit.  These guys must have been doing dances with the indigenous population directed at the Great Spirit and praying for inflation to get them out of this thing but so far, no luck.  Well, that's not quite true:  there's been a hell of a lot inflation but in all the wrong countries and the state of that mob is more that a bit of a concern.  In fact it is a mess particularly in regarding to currencies with enormous pressure today on the Brazilian Real and the Indian Rupee.  I fear this is not going to end as fiscally, the U.S. is a mess and economic numbers suggest an economy that is teetering between weak and God-awful.

All of this, however, pales in comparison with the danger of increased hostilities regarding Syria.  The Leader, has managed to place himself in a dreadful position where whatever he does will be wrong in some respect.  Unfortunately, he has managed to portray himself as a leader whose bluff can be called and this is precisely what has occurred.  It shouldn't come to that but the refusal to recognize that there are some really bad guys out there who could give a toss for what next scrolls up on the teleprompter remains a prevailing view in many corners of the administration.  After two weeks of babbling in the popular press, someone came to the realization that at this stage Damascus sits about a leisurely two hour drive from the Golan Heights and if the curtain goes up...oh well.

The markets of course went into the crapper, except for gold which continues to rebound.  In these circumstances, nothing is real and there is nothing to do but sit and hope that the coolest of heads will prevail with the assumption being that in that part of the world there are cool heads to be found. We will wait along with everyone else.