How Central Bankers Bit Themselves

Grant Williams |

Now the news has arrived
From the Valley of Vail
That a Chippendale Mupp has just bitten his tail
Which he does every night before shutting his eyes
Such nipping sounds silly. But, really, it's wise.

He has no alarm clock. So this is the way
He makes sure that he'll wake at the right time of day.
His tail is so long, he won't feel any pain
'Til the nip makes the trip and gets up to his brain.
In exactly eight hours, the Chippendale Mupp
Will, at last, feel the bite and yell "Ouch!" and wake up.
-Dr. Seuss

Theodore Seuss Geisel was a master of anapestic meter.

An anapest is a metrical foot used in poetry which comprises two short syllables, followed by a long one. More familiarly (particularly in the world created by Seuss), it consisted of two unstressed syllables followed by a stressed one:

"Twas the night before Christmas and all through the house..."

Description: euss%20Stamp.psd

Or, in keeping with this week's theme:

"The sun did not shine.
It was too wet to play.
So we sat in the house
All that cold, cold, wet day."

Simple, but at the same time extremely difficult to pull off effectively.

Geisel was an English major at Dartmouth who eventually became the editor-in-chief of the college humor magazine, the Dartmouth Jack O' Lantern; but after being forced by the dean to resign his post after being caught drinking gin in his dorm room, he rather cunningly adopted the nom de plume "Seuss" in order to continue to be able to write for the magazine.

Apparently, nobody at the Ivy League college figured out the identity of the mysterious "Seuss."

When banned from his post for a gin-drinking crime
The scribe picked a name and then bided his time.
In a different guise he remained on the loose
By pretending to be the mysterious "Seuss."

Geisel graduated from Dartmouth and left the USA to pursue a PhD in English literature at Lincoln College, Oxford; but, whilst there, he met a lady named Helen Palmer who persuaded him that he should give up his dream of becoming an English teacher and pursue a career as a cartoonist.

Returning home without a degree but with a fiancée (named Helen Palmer), Geisel found that his drawing ability allowed him to earn a rather handsome living as a cartoonist after he succeeded in getting his first cartoon published in theSaturday Evening Post on July 16, 1927.

Geisel took a job as a writer and illustrator at the humourous magazine Judge in October of 1927, married Palmer a month later, and five months after that, his first work was published and credited simply to "Dr. Seuss."

A successful career as an illustrator allowed Geisel and his wife to travel extensively. According to Geisel himself it was on the journey home from an ocean voyage to Europe that the rhythmic noise of the ship's engines inspired him to write his first book, the anapestically titled And to Think That I Saw It on Mulberry Street.

While at Oxford (in England) a lady supposed
To suggest he choose drawing instead of his prose.
When the young man relented his future unfurled
And he ended up famous all over the world.

And that, Dear Reader, is how Theodore Geisel became Dr. Seuss.

Thirty-five years after the publication of And to Think That I Saw It on Mulberry Street, Seuss wrote The Sleep Book, the brilliant story of a contagious yawn, started by a small bug called Van Vleck, that would lull even the most spirited toddler successfully off to sleep.

On page 32 of The Sleep Book, we are introduced to the Chippendale Mupp, a curious creature with an extraordinarily long tail. The Mupp bites the end of that tail when he goes to sleep every night, and its length ensures that the sensation of pain only reaches him eight hours later, causing him to wake up. It's a brilliant and flawless alarm clock.

Description: upp%20Cropped.psd

Of course, once the Mupp has bitten his tail, the end result — in this case, a rather nasty, sharp pain — though delayed for quite some time, is assured; and there is nothing he can do about it.

I was discussing the Chippendale Mupp with Steve Diggle recently as we pondered the actions of central banks in recent years and, more specifically, the great inflation/deflation debate that has raged constantly ever since the dawn of QE. As the ECB battles to stave off what looks like deflationary pressures, Japan continues to struggle to generate the promised 2% inflation, and the US continues to pretend to the world that the cost of living from sea to shining sea is rising at just 1.46% per annum, it's abundantly clear to me that the day QE was unleashed into the world was the very same day that the world's central bankers — the Slip 'n' Fail Mutts — bit their own tails.

The pain from that bite is now working its way towards the brain and will, at some point, manifest itself in an almighty "OUCH!" that will wake the entire world; BUT there is one X-factor at this point: none of us knows exactly how long the Slip 'n' Fail Mutts' tail actually is.

We will find out.

Description: 303.png

Back in 2012 — July 26th to be precise — Mario Draghi, in a speech at the Global Investment Conference in London, uttered those famous words which put an end to the seismic volatility roiling European debt markets once and for all for the time being:

(Mario Draghi): ...the third point I want to make is in a sense more political.

When people talk about the fragility of the euro and the increasing fragility of the euro, and perhaps the crisis of the euro, very often non-euro area member states or leaders underestimate the amount of political capital that is being invested in the euro.

And so we view this, and I do not think we are unbiased observers, we think the euro is irreversible. And it’s not an empty word now, because I preceded saying exactly what actions have been made, are being made to make it irreversible.

But there is another message I want to tell you.

Within our mandate, the ECB is ready to do whatever it takes to preserve the euro. And believe me, it will be enough.

Almost instantaneously, the clouds seemed to part, the oceans calmed, and the storm abated — all based on an ephemeral promise from a man under immense pressure who, let's face it, if he was prepared to DO whatever it took, would most certainly SAY whatever it took.

Click here to continue reading this article from Things That Make You Go Hmmm… – a free newsletter by Grant Williams, a highly respected financial expert and current portfolio and strategy advisor at Vulpes Investment Management in Singapore.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

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