The European Union, Directed by M. Night Shyamalan
- Joshua M Brown
- November 1st, 2011
Okay, so Bruce Willis is a psychologist trying to help a kid who sees ghosts…but wait, there’s a twist! Bruce Willis is a ghost himself!
And then there’s this alien invasion, right, and they’re taking over the world…but wait, there’s a twist! The aliens are allergic to water! WTF?
Okay okay and then there’s this puritan village in the middle of the woods where the children are warned about monsters surrounding them….but wait, there’s a twist! The monsters are us in modern society!
The twist endings endemic to the films of M. Night Shyamalan have nothing on the incredible turn that things have just taken in Europe overnight. The Greek prime minister, more concerned with his own political survival than the economic stability of the world, has taken the psychotic step of calling for an austerity referendum less than a week after agreeing to the EU rescue plan that was so hard for the rest of the continent to achieve.
Risk assets are taking a nosedive around the world on this shocking twist, half the banks in Italy are halted and credit default swaps have blown out to all-time record spreads.
The world is stunned at this amazing development. The prevailing wisdom was that Europe would be a mess but would not succumb to a Lehman-esque total meltdown, especially given the haircuts that bondholders had finally, grudgingly agreed to just last week.
But like an M. Night film, the twist came when we least expected it, we shall see if the next twist has PM Papandreou out on his ass and the referendum plan scuttled.
Stay tuned (as if you had a choice)….
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The Reformed Broker is a blog about financial markets and the economy. Joshua Brown is a New York City-based investment advisor for high net worth individuals, charitable foundations, retirement plans and corporations... More.