Thanks to lots of discretion in all the right places, the Bear Stearns hedge fund blow up has yet to trigger a financial debacle worthy of a Shakespearean tragedy. With lenders to Bear Stearns' hedge funds pacified, if not satisfied, and CDO values still under wraps, the event unfolded more like a Monty Python skit:
Banker: Excuse me!
Farmer: Yes, sir? Me, sir?
Banker: Yes, quite. I believe my bank loaned you money some time ago to buy a pig. That loan is now due. When can we expect payment?
Farmer: Oh, I can't pay you, sir.
Banker: I'm sorry, I've had a cold. Can you repeat that?
Farmer: Yes, I said I can't pay you.
Banker: Still can't hear you. Annoying things, these colds.
Farmer (shouting): I said I can't pay you back the money, sir. Hard times, you know.
Banker: Can't pay back the money? Oh, dear. What will my supervisor say?
Farmer: That's why I'm going to the market, sir. To sell the pig. And then give your bank the money.
Banker: What pig?
Farmer: This pig, sir.
Banker: Oh, that is a pig you have there. So you sell the pig and then you give me the money? I see. Splendid. Are you sure? It looks sick.
Farmer: Sick? Why, it's the healthiest pig there is, sir.
Banker: But look at its face! It's got a rash or something.
Farmer: That's not a rash. It's lipstick.
Banker: Lipstick on a pig?
Farmer: It's pretty, isn't it"
Banker: Well, yes, sort of. I mean no! No, it's not pretty. It's ridiculous.
Farmer: Watch what you're saying. You might offend her.
Banker: Well, why would a pig be wearing lipstick?
Farmer: Because without the lipstick it would be just a pig. Now it's a pig with lipstick. She's worth a lot, you know.
Banker: How much will you get for her, then? Enough to pay back the loan?
Farmer: With lipstick and all?
Banker: Yes, yes, how much?
Farmer: I don't know. A lot, I suppose. You know, pigs like this are in demand.
Banker: In demand? Since when did so people have such an interest in buying pigs with makeup on them?
Farmer: Oh, these pigs have been quite the thing for a while now. And it's just lipstick, sir. No eye shadow or anything.
Banker: So when will you have money?
Farmer: After the auction. It's right in here, sir.
...At the auction...
Farmer: It's our turn now, sir. See, there's my pig. The one with the lipstick.
Banker: They've ALL got lipstick!
Farmer: I told you it was the thing, sir.
Auctioneer: Now, what do I hear for this pig, pig No. 236?
Farmer (shouting): Don't forget the lipstick!
Auctioneer: What do I hear for pig No. 236 wearing lipstick? Do I hear 100? One hundred?
Farmer (to banker): See, that's just what I owe you, 100.
Auctioneer: How about 90? Do I hear 90? How about 80?
Banker: There's no one bidding!
Auctioneer: Seventy-five, 75? Sixty?
Farmer (shouting): That's top-of-the-line lipstick!
Auctioneer: How about we start the bidding at 50? Anyone bid 50? Fifty?
Banker (jumping up): Hold it, we've changed our mind!
Auctioneer: Changed your mind?
Banker: Yes, we've changed our mind. We're not selling. The pig is off the market!
Farmer: Why is she off the market? I thought you wanted the money.
Banker: Money is not everything. We're leaving.
Farmer: Don't you want to see what my neighbor's pig sells for?
Banker: Who is your neighbor? Oh, him? I loaned him money too. Tell him to come with us. Let's forget this whole pig-selling thing. As far as our bank is concerned, your pigs are still worth 100. We don't need an auction to tell us that.
Farmer: What about the money we owe?
Banker: Oh, you still owe it. But let's not worry about that right now.
Farmer: You look like you could use a stop by the pub, sir.
Banker: Grand idea. Let's get out of this wretched place.
Farmer: You think I can bring my pig inside? She likes pinball.
© Copyright; Foundation for Economic Growth and various authors. Individual authors retain their own copyright.
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