The Test Of Central Bank Omnipotence May Be Upon Us.
Over the last few months the financial media has not only turned deaf ears to the drama, (out of boredom) they have also blindly discounted any contagion effects as “isolated” at best – relative periphery contagion at worst. In other words: Any and all problems can be contained, mitigated, or solved by none other than your friendly neighborhood Central Bank. After all, if you listen to the so-called “smart crowd” these bankers have powers even Zeus would envy.
So why worry about a little turmoil at the foot of Olympus? After all, the gods haven’t been seen nor heard from in millennia. Central Bankers give press conferences live and in person. Thunder vs a press conference? No contest in today’s role for proving omnipotence. All one needs to remember for proof is Mario Draghi’s now famous chortle of “having a bazooka and willing to use it.”
However, just as in any hero-worship endeavor one thing must remain constant or it all falls apart. Those that worship can never witness any event regardless of how minor: that the gods are not all that they portend to be. In other words: Allow just one moment of truth to be witnessed showing frailty instead of omnipotence – and the whole ruse falls regardless of the size and strength of the monuments and temples built to honor. For they will be abandoned. Sometimes slowly. At others: all at once. It doesn’t take much.
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