Friday, July 15, 2011

#11 EAGLE LEARNS STUFF ABOUT THE DOLLAR WHICH MAKES HIM SAY ‘OUCH’ (A birds eye view of the mess we’re in)

Injured Bald eagle (Haliaeetus leucocephalus) ...

Image via Wikipedia

Cuckoo woke up when dawn was far advanced.

As he looked down from EAGLE’S eyrie, he felt a brief spasm of vertigo. He was used to reasonable heights, but nothing like this. They were thousand of feet up and the drop from EAGLE’S marvelously equipped private quarters was near vertical.

A fish thumped in front of CUCKOO, and he heard a distinctive eagle cry in the sky. He thought the fish looked like a char, but he was no expert in high altitude fish. He consumed it during a leisurely breakfast, and caught up with the news on EAGLE’S iPad.

EAGLE, having fed his guest, wouldn’t be able to get back until early afternoon. He was attending a Council of Eagles meeting where there were weighty matters to discuss. These were: climate change; air pollution; and pesticides.

EAGLE returned in a gloomy mood. “We have the evidence,” he said, “but there is a hard core of Right Mugs and Tea Mugs who won’t listen to anything. The bottom line is that my people are being poisoned. And their deaths mean nothing. Don’t they understand that if we are dying, humans are dying too.  We share the environment. We’re like an early warning system, and we’re being ignored. Actually, that’s not quite true. Some humans are desperately concerned, but there are enough of these economic fundamentalists out there to block reform. Does a free market give you the right to poison?”

CUCKOO didn’t understand why the Right Mugs, with the Chamber of Commerce leading the charge, so consistently opposed all efforts to improve the environment. Surely they were living in it too. They were also anti-science. You could produce all the evidence in the world, and they would disregard it if it didn’t fit their agenda. It was as if they were practicing a form of religion.

“What about climate change?” he asked.

We know it’s happening,” said EAGLE. “We live outside. We are acutely sensitive to the climate. But, once again the humans are split.”

EAGLE went to visit MRS EAGLE in the family quarters and returned somewhat calmer.

“I don’t want to oversell Europe,” said CUCKOO, “but what I told you yesterday is true. Europe does a much better job of looking after its people. Its economic system – the European Business Model, to use jargon – is also based upon free market capitalism but with many of its rough edges smoothed out.”

“But Europe has a debt crisis,” said EAGLE. “Look at the PIIGS: Portugal; Ireland; Italy; Greece; and Spain.”

“Europe remains a work in progress,” said CUCKOO; “but I would like to remind you that the U.S. has a debt crisis too. The only reason it isn’t more serious is that the dollar is a reserve currency.”

The trouble with eagleomics,thought EAGLE, is that there is too much of it. For all his months of studying, new terms kept on popping up. But then CUCKOO had been studying all this stuff for years; and CUCKOO was exceptionally smart. In fact, there were times when EAGLE wondered if CUCKOO really was a cuckoo. He sighed.

“OK, I surrender. What’s a reserve currency?”

“It’s a currency that nations store their reserves in and pay their international bills with,” said CUCKOO. "That makes it more valuable than it would be otherwise because it’s in demand. Most international trade takes place in dollars. This was all set up just after the war at a place called Bretton Woods.”

“The Chinese can’t  like this very much,” said EAGLE.

“They don’t,” said Cuckoo. “So they are trying to change it. And when they do, our costs will go up and so will interest rates. You see, right now EAGLE-LAND can print as many dollars as it wants because the currency in demand is the dollar. But if international trade is switched to something else, and nobody wants the dollar…”

“I get the idea,” said EAGLE. It was one more Sword of Damocles suspended over his country. “When do you think this might happen?”

“Some people say twenty years,”said CUCKOO. “I think within five.”

EAGLE tried to imagine the effect. The price of all imports, including oil, would go up; and so would interest rates on everything from mortgages to the National Debt. The cost of living would rocket. The average American would be crucified.

“Ouch!” he said.

“Be glad you’re an eagle,” said CUCKOO.”



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