Michelle and Stan lay in the afterglow of another stolen afternoon in his bedroom. Stan looked at the ceiling and wondered if his dad would notice if he installed the mirrored tiles that he found that weekend he was cleaning out the attic and came across a box marked “Farewell to the Seventies.” Stan had already sold the bong in there to Rich’s dad. The fuzzy handcuffs he had kept.
Michelle turned to Stan, a look of concern messing up her smooth pink skin.
“Yeah, Shell?” Stan envied Rich. Rich never talked after sex, beyond “See ya” or “You won’t tell your mother, right?”
“I need to ask you something serious.” Seven words that, when spoken by a woman, usually made a man’s sphincter tighten so hard that neutrons could not pass through. Stan grunted, waiting for her to continue. “You know, Sara and Penny were talking the other day, when we were in the sauna at the health club, you know?”
Stan’s interest was piqued and he turned to her, brushing her thigh. “Uh huh.”
“Hmm. That’s nice. A little higher. Anyway, Sara was saying that the week dollar policy currently being pursued by the Federal Reserve is a good idea because it will improve the trade deficit, but Penny thinks that in the short term – oh, yeah, right there, slowly – it will decrease the attractiveness of US government debt on the international financial markets.”
Stan lifted himself on one elbow. “And you want to know who’s right, baby?”
“Well, I think they’re both right and they’re both wrong. No, don’t let my hands free, I like to squirm. Oh, yes, right there, make me whimper for it like a cheap little trick. Anyway, while it improves the trade deficit to make American goods cheaper in terms of other major world currencies, it also makes energy costs more expensive, providing an inflationary effect to the costs of production which may cancel out the currency exchange discount factor.”
Stan nodded as he turned Michelle over and watched her arch her back like a cat in the sunshine. “Good point. And on the capital inflow side of the equation, at the same time that US treasuries are becoming less attractive as a form of fixed investment in the Euro and Pacific zones, US equities are more than compensating …”
“… because they provide a – oh my, where did you learn THAT little trick, big fella? – provide a surprisingly attractive combination of value pricing and strong fundamentals, which equals a perfect opportunity for both value and income investors. That was what I was trying to explain to the girls, you know?”
Stan shrugged. “And they couldn’t see that? Typical. I suppose they argued that if devaluation continued, any returns on investment from the international community would become uncompetitive with the ROI profile of the BRIC countries? Hold still, I’m not sure this is lubricated enough.”
“Lube is for newbies, you’re turning me pro. Anyway, that was exactly what Sara said! Penny was all about how the real threat to profitability came from the potential for petroleum costs to break back out of the $80 a barrel barrier. No, don’t take your fingers out of my mouth, I can talk around them.”
“Well, listen, Shell. Sara and Penny have always focused on a more micro-analysis of economic phenomena. I think they are afraid of the paradoxical nature of macro-markets. I hoped you tried to introduce your argument about stabilizing political forces? You might feel a little pinch…”
“Oh God, yes! Stan, did you ever do this to, I mean, with Brandi?”
“No, Brandi doesn’t think in terms of finance and capital, she’s all about labor, service and commodity markets. I shudder to think of what would happen if she and Aggie went at it.”
“Sara said that too. But I’m not sure if she was talking about about the role of free movement capital in global development. Anyway, yeah, I did try to explain about cohesive political force having a positive effect on – Jesus, Stan, what is THAT? No, don’t tell me, just do it again sometime when I don’t expect it and for God’s sake don’t take no for an answer…”
“I won’t. What did they say?”
“Well, Penny seemed to consider the idea, she said something about modern-post-neo-conservatist pragmatism being ugly on paper and elegant in practice, but Sara found the apparent hypocrisy on issues of freedom and autocracy to be a central weakness in the approach… Oh Stan, are you sure nobody else is home?”
Stan took the signal and covered her mouth for about ten seconds. When the screaming was over, he kissed her on the top of the head and ran his fingers over her lips and then pulled her hair back. She smiled through her tears.
“Let me guess, you dirty little minx,” he whispered darkly in her ear. “She brought up the Cheney-in-Vilnius argument again, didn’t she.”
Michelle giggled. “Yep. She was all ‘first the guy goes to Lithuania to badmouth the Russians on how they use democratic institutions to mask an unreformed authoritarian nomenklatura and then the next day he’s in Astana shaking Nazarbayev’s hand and praising the President For Life of Kazakhstan!’ Which, I admit, is a strong image for her point. Oh, Stan, you are so good at this!”
Stan nodded and caressed her neck. “But on a deeper level, it’s a pragmatic move on the part of the American government, signaling to the Russians that we too have a two-faced policy, where we sell one message in the Euro Zone and another in Central Asia. It’s the hypocrisy itself that tells the Russians, the regional superpower, that we understand them…”
“GOD yes, exactly, and since they are the major non-OPEC petroleum producer, we are signaling that we can do business with them politically – I can’t last much longer, baby – as well as economically…”
“… and thereby injecting a hedge against the primary destabilizing force …”
“… on energy costs – oh right! right there! -- which in turn …”
“… lessens the risk that skyrocketing energy costs to production …”
“… will erode the value of a softened currency. YES YES STAN THAT’S WHAT PENNY AND SARA DON’T GET!!!”
After the convulsions, as Michelle fell asleep next to him, Stan gazed at the ceiling and came to three conclusions. One, Sara and Penny must be doing threeways with Rich, whose old-school Chicago Nobel laureate 60s and 70s era pricing and tax mechanism theory routines were evident in their arguments. Two, Michelle was doing a good job of opening their eyes to the possibility of a more politically-driven model of proper monetary theory. So three, the mirror definitely had to go up.
After all, Penny loved to look at herself wherever she ended up...
Papuasblya wrote:As a public service to this forum (and anyone else who has ever met me) I gave up avoiding looking like an idiot a long time ago.