By the Boiler Room Elves
Elves live to travel, especially Boiler Elves. From touring boiler plants in Brazil to fact-finding missions at plush resorts in the Caribbean to top secret visits to an ocketsleigh-ray actory-fay in ina-Chay, we just can’t get enough. In fact, we just returned from London, where we attended the Elf Professional International Cookie Accounting Conference (EPICAC.) The topics this year have been somewhat disheartening:- Biscuits, Cookies & Shortbread: The Crumbling World of Multi-national Baking
As we listened to lectures on chocolate chip depreciation recapture, our minds started to wander, and we found ourselves thinking - does it really matter if Europe collapses?
- Emerging Markets and Sugar Quality
- Baked Goods at Tea Time - A Necessity? (an extremely heretical stance even to question, mind you, but not surprising in this day of cutbacks)
Europe teeters on the edge. Everything south of Germany is broke. No one wants to throw good Elf Marks after bad Euros. European banks are near collapse. Britain just had riots and now their government is fighting to keep Britons from voting to take back power from Brussels. Government after government seems ready to collapse, and the headlines scream about the end of Europe. Even Alan Greenspan said yesterday that the European Union is doomed to fail.
In our networking sessions at the conference, we met several elves whose lives have changed because of the crisis. One elf from Portugal, well into his maple years, told us he hoped to retire quietly to his kitchen, but was now forced to start anew in the UK. Carlo, an elf from Italy had been happily making a living as an actor until about a year ago. Now he works in England as a waiter. The cookie buyers guilds’ profit forecasts were way down. A consultant from Baker & McElfzie, said his firm had been driven to branch out into teacakes and muffins. (How the mighty have fallen...) Difficult times, my friends, difficult times.
But this is how capitalism works and what Europe doesn’t seem to understand. When people stop buying red and white candy canes, you innovate and give them red and white and green. If the candy cane market dries up altogether, you find something new to do for a living. You don’t wait for another handout from another government because your red-and-white candy cane union needs their 6 weeks of paid vacation and retirement at age 50. The USA never went as far as Europe down that path, and you can see the pain we’re having just trying to back away.
There’s no doubt a collapse of Europe would be bad for stock markets, big companies, European governments, and red-tape makers everywhere. It’s going to get uglier before it gets better, but in the long run, the whole world will be better off if every country just takes its medicine.
Of course, you know the old conventional wisdom -- “as goes Europe, so goes the North Pole.” The North Pole’s Santa-based economy is admittedly highly export oriented and its biggest market is Europe. Even America, the land of the soon to be free again and the home of the Boiler Room Elves does a lot of business with Europe. We elves would like to see Europe grow strong again. Will it take a complete collapse to do set them straight?
Thursday, October 27, 2011
European Elfcation
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41 comments:
So that's where the elves have been! I hope your visit to ina-Chay went well... no problems with customs. ;)
On Europe, this is one of those problems where your neighbor did something really stupid, something you told them not to do, and now there are no painfree ways out of this mess. We suffer because they're idiots. Nice huh?!
Our elves are part of the solution. European elves are part of the problem.
Customs is rarely a problem when you travel by private sleigh, Bossman!
Re Europe, we would add that we were surprised at how little everyday people seemed to care. Restaurants were full, we couldn't get theatre tickets... people were just living their lives like nothing was happening.
The neighbors still have their head in the sand, so to speak.
Bossman LawHawk, we try to be part of the solution, we try!
But we have to give credit where credit is due, too. Our European brethren do know how to bake!
BRE, Did you do the riot tour? I did hear that 1 in 8 of the rioters was foreign (and 1 in 7 were on benefits).
Lawhawk, LOL! Yep -- Euro elves are the problem!
Believe it or not, Bossman Andrew, no company was offering a "Riot Tour!" (And believe me, we asked around!) I'll bet you pounds to crumpets that an Amercian company would be offering it!
Ve have lots of fudge cookies to bail out die Europe! Vatever die Greeks or anyone else need, ve have it for dem. But of course ve have to deliver dem in person, so don't get alarmed if lots of us come over der border unannounced und in marching formation...
"German Elves" (the commenter formerly know as T-Rav... I presume),
I can't pass up this chance to tell a joke...
Q. Why are the street in Paris lined with trees?
A. Because Germans like marching in the shade.
As long as you bring Euros and some beer, German Elves! And maybe some of those little sausages, too.
Excellent question! I wonder about this myself too. What would happen to the US if the EU fell apart? And would that be better in the long term or not?
maybe some German Elf intervention wouldn't be a bad thing... For every Euro the Greeks have to replace a high official with a German Elf...
Why, I have no idea what you're talking about, Andrew...
But as long as we're talking German jokes, here's one from "That 70's Show":
Kitty: What about this family, the LeVaux's, Red? They seem like good buyers--
Red: Kitty, I am not letting any Germans buy our house!
Kitty: Oh Red, I think they're French, not Germans.
Red: Exactly, and what do you think they'll do once they get it? Surrender it to the first German couple that comes along!
rlaWTX, Could you imagine the outrage if the Germans demanded seats in the Greek government? Wow!
DUQ, Honestly, I have no idea what would happen. We'd lose our biggest export market to massive deflation. The stock market would CRASH. But after that, things would get better again. How bad would it be? I really don't know. I'm not sure anyone does know.
T-Rav, LOL! Nice! :)
DUQ and Bossman Andrew, we Elves do believe we'd come out stronger in the end. But make sure you've got some candy canes socked away 'til we get through it!
rla, we like the way you think! Now, make those US Elves... heh heh...
Very funny, T-Rav! We'll add that to our list of jokes next time we head to Europe!
Hilarious! I love the idea of chocolate chip cookie depreciation recapture and EPICAC! Lol! Twisted. and his "maple years"! Lol!
Greart article Elves and interesting question. I think the EU is so messed up from the beginning that it probably can't be saved. So it's better to fix it or kill it now rather than keep throwing good Elfos after bad!
DUQ, I suspect the question is not "if" the EU will fall apart, but "when." Because when the Euro collapses--and that almost certainly is a when--I can't imagine the EU will be able to continue.
Right now, the European nations are probably on the path to resuming their own individual currencies in the near future, because of the situation the BRE laid out. Once the Greeks default and then riot until they get a bailout, chances are the other debtor nations--especially Italy, Spain, and Ireland--will do the same. Estimates are the price tag for a bailout of all those countries will be about 3 trillion euros, and as strong as the German economy is, it can't possibly begin to bankroll something like that. So it will probably renege, and thus trigger the wholesale collapse of the euro as a currency. And with the resumption of individual currencies in competition with one another, to a great extent the EU will only exist on paper.
What that means for the US, I have no idea. I suspect our position would improve, because we'd have a bunch of weaker currencies to compete against rather than one strong one, but I'm not certain of that. It would (will?) surely be an interesting scenario.
Ed, if you love chocolate chip depreciation recapture, then you're a sick, sick man! But you probably can command a very high salary. Just sayin'!
The Elves had heard rumors from multiple sources that the Germans are indeed quietly printing Marks again. Trouble is, we haven't been able to verify that, nor can we confirm that it's not just conspiracy nuts spouting that. It's just making the rounds.
In short, it won't surprise us, either, if/when Europe falls back in separate countries. OR at least into a Northern EU and a Souhern Club Med, so to speak. Which could be interesting, too. A Northern Euro could be a formidable competitor.
Thank yew, thank yew, I'm here all week! Try the veal! :-)
Nothing the Germans do surprises me. I mean, c'mon. They're Germans.
T-Rav, When I lived in DC, I got into an argument with a man from the World Bank. It was during an interview, so you can guess I did not get the job.
He thought the Euro was great. I warned him that the first recession in Europe would trigger its slow-motion collapse. I told him the problem is that the Euro has no enforcement provisions. It's like giving 20 people credit cards with unlimited limits and telling them to be good because everyone else would need to pay their debts and going wild with spending just wouldn't be very nice.
He did not like my practical view. He told me "public pressure will keep these countries from overspending because none of them will want to be seen as profligate." I thought, "what kind of world are you from?" I was right. He did not grasp that local politicians would pay no price for spending like mad on the Germans' credit. Sure, the Germans will be upset, but they can't do anything about it under EU rules. So there was nothing stopping the insanity.
I think you're right on the future. There is no way the Germans can foot the bill and trying to make them will only cause a split. So unless the come up with a plan to devalue their weaker members and still somehow keep them in, then the inevitable result will be to break up the Euro in part of whole.
In terms of the effect on us, that is really hard to say. My fear would be some sort of world-wide deflationary spiral that brings on another Great Depression. That could happen because the world economy is so strongly tied together now and because being hitched to a corpse will drag us down too.
Or nothing could happen. It could well be they just kick out their smaller members who overspent and the rest of us go on barely feeling like we hit a speed bump.
One problem either way is the uncertainly is probably stalling the world economy because no body wants to do anything if they have no idea what next week will cause.
T-Rav, You may not be surprised by the Germans, but they do have a knack for surprising their neighbors! ;)
Ok, I'll stop.
Andrew and T-Rav, Interesting views. I figured the plan with the Euro was to pull people in with the idea that it had no rules and then slowly impose the rules when no one was looking. Apparently, things fell apart before they could do that. I wouldn't be surprised if they now imposed a whole lot of rules and then said "take it or get out" to their members.
I guess it's a good thing that the crossword puzzles still use lira and francs in their puzzles...
At least the Germans march in nice neat rows...btw - is ina-Chay anywhere near Escondido?
What's really a little unsettling is that the Mayans may have been right about 2012.
Bev, The timing on the Mayan prediction is getting a little coincidental... isn't it? I guess we should all store food and asbestos underwear in our basements!
rlaWTX, LOL! You must be an optimist! :)
Any word on how this will this affect the production of macarons and florentines?
Andrew, I guess that's what happens when you expect people to be rational actors 100% of the time, which they are not.
Here's a graphic, incidentally, which explains the projected collapse of the euro far better than I could:
http://directorblue.blogspot.com/2011/10/bulletin-french-president-sarkozy-finds.html
On a more elemental level, I think not just the euro but the whole idea of trying to create a "United States of Europe" is fundamentally flawed. Fact is, there is no way to make, say, France and Germany the equivalent of Florida and Georgia. There's way too much history between these countries to simply erase the centuries of distinctions between them. I think this project was doomed from the start.
Ed, a lot of the problem lies in the fact that the European people were not persuaded so much as told to vote for this. When the Maastricht Treaty was passed back in '93 (the treaty which laid the groundwork for adoption of the euro), either the French or the Dutch very nearly rejected it. In response, one of the planners reportedly told his cohorts, "We must never again allow this to come to a vote." In other cases, the plans for euro adoption actually have been rejected at the polls, only to be put back up for a vote again and again until the people "get it right."
This just shows the extent to which modern Europe is a technocratic, as opposed to a genuinely democratic, society. And I think that's what's hurting them now; the planners have no understanding of how economies actually function, and thus don't understand what actually has to be done to fix this.
T-Rav, I'm not so sure the history matters per se because the current crop of Europeans seem to disdain their past more than anything, but I think the problem is the language and the cultures. It would be like us merging with Mexico suddenly. We're just too different because we see the world fundamentally differently.
(And even in that example, we have more ties to Mexico than most of the Euros have with each other.)
Here's your link: LINK
tryanmax, The elves are apparently commuting at the moment. They'll be back later. But in terms of the macaroon supply, I'd think Europe becoming this generation's Argentina would probably make them very cheap! :)
T-Rav, Excellent point on the EU being a technocratic creation forced upon the people (Ireland in particular has been made to vote repeatedly until they "got it right".)
I think what you have are bureaucrats who don't understand how the real world works (when have they ever) and they figured they could just gloss over all the problems by drowning them in paper. But that only works until things go wrong. Once people start demanding results and looking after their own concerns, paper turns out to be a very, very thin shield.
Right now Europe has a confused political structure with no one really knowing who has what powers or what they can or can't do -- and conflicting opinions everywhere. Moreover, there's no way to do anything even if they do agree. Hence disastrous deadlock.... death by inertia.
And whaddya know, Elves. Here's your rumor confirmation about the Germans printing marks again:
http://seekingalpha.com/article/302290-germany-is-already-printing-money-deutsche-marks
T-Rav, Interesting article. It makes sense. Basically, Germany would be walking away from the mess created by the southern countries and leave them to their fate. I wonder how likely that is to happen?
Here's the link: LINK
Andrew, surreptitious printing of old currencies? Shouting matches between Merkel and Sarkozy? They're all still insisting on their loyalty to the euro in public, but I'd say some kind of formal division is very likely, and trending toward inevitable.
T-Rav, I'm not sure they have any other choice. The Germans are limited in what they can do by their constitution and the others are limited by their financial strength (or lack thereof).
It's possible they just don't have any answers and they're just doing theater now.
Plus, these leaders aren't exactly the boldest. So I wouldn't rely on them doing anything creative.
Ah-ha! Thanks for coming through with that, T-Rav! We suspect it's still unsubstantiated rumors. But then, Elves always did go in for rumor-mongering.
Tryanmax -- as you may well, know, macaroons have recently quadrupled in value. They are the only baked good never to be worth zero. Many an Elf suggests that returning to the "Macaroon standard" is the way to go.
rla - Crossword puzzles also like to use "anon" and "e'er" but we're not sure those are coming back either!
Bev - Escondido is, in fact, much better for a different sort of smuggling than ina-Chay...
excellent point, Elves. I sit corrected.
(wouldn't want you to strain your necks)
"...the whole world will be better off if every country just takes its medicine."
oh, those elves are dreamers!
Patti, Isn't it sad when common sense seems like such an impossible concept in the modern world?
If this country was run like a business, we would completely reorganize our finances and buy out a few of those countries. Sort of like a hostile take over. I would especailly like to see Ireland and Greece become the 51st and 52nd state. More beer and make the greek finally give up that ridiculous language. I think there may be real promise in these countries, but they just need to be reorganized as well.
Or maybe Athens can sell of pieces of the parthenon and Ireland can sell off Guiness.
Very considerate of you, rla! :D
You may call us dreamers, Patti, but we're not the only ones...
Koshcat, the elves would pony up some Elfos to buy a few countries in Europe. Maybe a something with a nice castle on a lake!
A rip roarin' post BRE's!
But I noticed that Transelfvania is mysteriously missing from your list.
And I don't think that was an oversight.
Perhaps you are, shall we say, transelfphobic over the different lifestyle of the transelfered?
Sure, they are an odd bunch (not that theres anything wrong with that) and some (not me) might call them creepy looking (they do have a strong resemblance to Eddie, Lilly and Grandpa Munster), but hey, Lilly is/was hot. So why all the H8?
Seriously, you give Brazil a shout out but conveniently "forget" Transelfvania? I suppose you have also forgotten the Oscar winning Transelfvania 9000 epic motion picture?
What's Brazil famous for other than a bad comedy?
Quit livin' in the middle ages and get with the program already.
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