Face it: money is mysterious. These days, it seems to very malleable, coming in a variety of sizes and shapes from round and hard to plastic and rectangular. Sherlock Holmes is a lot like that. He keeps coming back – like Robert Downey Jr in 2009 or Vasily Livanov doing it in Russian in the 1980s.
The new season of the BBC Sherlock series is now airing on PBS– with Benedict Cumberbatch back in command after his high-flying suicide at the end of Season Two (just like the original suicide leap from Riechenbach Falls engineered more than a century ago.). As written by the modern successors of Arthur Conan Doyle, Sherlock has even more in common with the characteristics of modern money. As the Rolling Stone’s Logan Hill wrote: Holmes, as played by Cumberbatch, isn't always likable. "He likes to think of himself as a highly functioning sociopath," says [show creator Stefan] Moffat. "More accurately, he's someone who wants the excuse of being a sociopath so that he doesn't have to do the things that bore him."
Certainly, Sherlock shares the egotism of contemporary economists. "My mind," Holmes declares in The Science of Deduction, "rebels at stagnation. Give me problems, give me work, give me the most abstruse cryptogram or the most intricate analysis, and I am in my own proper atmosphere. I can dispense then with artificial stimulants. But I abhor the dull routine of existence. I crave for mental exaltation. That is why I have chosen my own particular profession,—or rather created it, for I am the only one in the world."
Like modern central bankers, Holmes is more confident than transparent. “The world is full of obvious things which nobody by any chance ever observes,” says Sherlock in The Hound of the Baskervilles.
Sherlock, it would seem has accumulated some good advice for central bankers. 'It is a capital mistake to theorize before one has data. Insensibly one begins to twist facts to suit theories, instead of theories to suit facts,” he says in A Scandal in Bohemia. "Data! Data! Data!" he says in The Adventure of the Copper Beeches. "I can't make bricks without clay."
One longs for the day when the world’s central bankers can say of the gold standard: “I confess that I have been blind as a mole, but it is better to learn wisdom late than never to learn it at all.” So said Sherlock in The Man with the Twisted Lip. One of Sherlock’s favorite lines is good advice for Janet Yellen and company: ‘'It is an old maxim of mine that when you have excluded the impossible, whatever remains, however improbable, must be the truth.'
Ok, it’s more orange than gold. It’s gooey, which is never good for a portable money standard. A monetary standard should be hard and clink when it is dropped. Velveeta is simply too tasty to last – especially among those who want to spread it on their nachos rather than exchange it for goods and services.
Moreover, Velveeta is subject to the vagaries of the National Football League. Bloomberg Business Week has reported that the “Velveeta shortage first reported by Ad Age on Tuesday morning, with some of the more concerned already calling it ‘cheesepocalypse.’ The culprit: high demand as the National Football League playoffs kick into high gear, the company claims.” Vanessa Wong wrote:
Although a Kraft Foods spokesman maintained that the Velveeta shortage was a short-term problem, she admitted that it came at the product’s “ busiest time of year.” Still, there was some suspicion that the “shortage” was simply an attempt to boost sales.
There is always the possibility that Kraft chose to taper off its manufacturing capacity in an attempt to wean Americans off nachos. Where is Janet Yellen when you need her?
CNN reported in August that the Double Oreo is a bit understuffed: “A high school math teacher in upstate New York tasked his students to find out just how much "stuff" is in each type of Oreo -- original, Double and Mega Stuf.
"Most of them have had practice, as have I, in separating the Oreo in half and getting a clean side, but getting two clean sides off just leaving the stuff was difficult," said teacher Dan Anderson.
Oreo: Original vs. Double vs. Mega
Here's how they did it.
The students weighed 10 of each type of sandwich cookie -- original, Double and Mega. They also weighed the wafers separately, without the creme
Subtract the weight of the wafer from the total weight of the cookie, and you get the stuff!
Oreos attract attention. Fast Company’s Alice Truong noted that Oreo was has been fast on the tweet after the birth of Prince George: “Oreo is at it again, brilliantly executing a social media campaign that shows it's tapped into the moment. With everyone on royal baby watch, the company tweeted an image of a milk bottle with an Oreo cookie featuring the tag line ‘Long Live the Creme’ the moment news broke about the baby's gender.”
Months earlier, Oreo used the half-hour Superbowl blackout to tweet “you can still dunk in the dark” with thousands of retweets. Oreos were also featured in a Superbowl ad around a “whisper fight” in a library.
Twitter has made a major deal with Mondelez, whose products include Oreo cookies. According to the Financial Times’ Emily steel, “As part of the agreement, Twitter will deploy teams to work with Mondelez in Brazil, India, the UK and the US, helping local marketers tap Twitter’s knowhow. The deal, which includes an ad spending commitment, gives Mondelez access to preferential ad rates, ‘brand boot camps’, custom research and a first look at new products.”
Oreos, which are a year older than the Federal Reserve Bank, is apparently trying to keep itself fresh and relevant. While they probably would like to be as plentiful as Quantitative Easing, they chose a different approach to celebrating their 101st birthday this year. According to the New York Times back in May, their advertising campaign was centered on the “fact” that they are wonder-filled – which is more than one can say for the Fed. Stuart Elliot wrote:
The idea behind that theme was to demonstrate how Oreo could transform everyday occasions in the lives of adults into fun-filled moments. The idea was brought to life in commercials by having children — bearing trays laden with Oreos and glasses of milk — interrupt routine events like commuting to work or taking part in a school board meeting.
Now, a good currency should be transformational as well as transactional. The centennial ad campaign for Oreos was tagged: “Celebrate the kid inside.”
Still, one probably doesn’t want one’s kids hanging around the Fed. Their financial perspective might become totally warped. But it would be nice if the Fed paid more attention to kids and less to Wall Street. More Oreos, please.
Olympics will not solve a country’s fundamental fiscal and monetary problems. Brazil is learning that lesson. Russia is also well. Greece learned it painfully. Japan may well learn it in 2020.
The Financial Times’ Jonathan Soble wrote that Prime Minister Shinzo Abe “and his government are framing Tokyo 2020 as the symbolic heir to the Japanese capital’s Olympic debut half a century ago Fittingly, it was Mr Abe’s grandfather, Nobuskuke Kishi, who led the country when Tokyo’s bid for 1964 went through....Abe hopes to crown its emergency from a long period of economic stagnation and malise, one that started in the early 1990s and is still clinging to its heels.”
Abe himself declared: “I want to make the Olympics a trigger for sweeping away 15 years of deflation and economic decline.” Noted Soble: “Of course, for the Olympics to become a symbol of a revived Japan, Japan will have to revive. ‘Abenomics’ goals such as turning mild consumer-price deflation into mild inflation are trifling when set alongside the task of rebuilding bombed-out cities full of starving citizens.”
The chair of Japan’‘s largest industrial lobby declared: “Japan’s economic recovery should get even stronger with more infrastructure investment and accelerated redevelopment of the capital region, as well as an increase in foreign tourism.” Tokyo’s advantage, of course, is that much of the needed infrastructure already exists. But the temptation for more infrastructure may be more than infrastructure-happy Japan can resist.
Meanwhile, Prime Minister Shinzo Abe is embarking on a major tax increase – boosting the IVA from 5 to 8 percent. The Wall Street Journal’s Takashi Mochizuki and Mitsuru Obe have written: “While recent indicators have underlined the economy’s strength, including Monday’s data showing the world’s third-largest economy had grown 3.8% in April-June, opponents of the tax rise have stressed the move would kill the chances of s sustained recovery.” The new tax increase was passed by a previous government and set to go into effect next April. The question is whether Abe’s government will seek to block it.
Abe is trying to rejigger the Japanese economy at the same time that he tries to lower the country’s ballooning debt. The Journal noted: “Business have also called for a cut in the corporate tax rate, one of the highest among industrialized nations at around 38%, and Mr. Abe has told officials to study the option. But wary of a fall in tax revenue, the finance ministry has long opposed it” As Abe works on one segment of the economy, he risks throwing others out of whack.
Economic commentator Satyajit Das wrote in The Independent: “Irrespective of the eventual outcome of Abe-nomics, Japan's aggressive monetary policy may lead to large outflows of private capital from Japan into foreign markets, with destabilising side-effects.
In the 1990s, aggressive interest rate cuts in Japan in the aftermath of the end of its bubble economy led to a large and rapid outflow of capital, fuelling a rapid increase in debt levels, which was one of the factors underlying the Asian monetary crisis of 1997-1998. The risk of a repeat has increased.
The devaluation of the yen against other Asian currencies increases Japanese export competitiveness but at the expense of China, South Korea and Taiwan, who may intervene in foreign exchange markets to reduce the appreciation of their currencies.
Sodas come in all sizes. From minicans to multi-liter bottles and 64-ounce Big Gulps and the 124-ounce Team Gulp at 7-Eleven. But in New York, recently, restaurants faced fines if they sells or other drinks containing sugar that are larger than 16 ounces. The move was widely unpopular, according to polls.
Once upon a time at Coca-Cola, the six-ounce can was sacrosanct, wrote Slate’s Brian Palmer last year: “ President Robert Woodruff held firm to the 6-ounce size, even as his subordinates warned him that Pepsi was onto something [with 12-ounce bottles]. By the 1950s, industry observers predicted that Coca-Cola might lose its dominant position, and top company executives were threatening to resign if Woodruff didn’t bend on bottle size. In 1955, 10- and 12-ounce ‘King Size’ Coke bottles hit the market, along with a 26-ounce “Family Size.” Although the new flexibility helped Coca-Cola regain its footing, the brave new world of giant bottles was hard to accept for some. Company vice president Ed Forio noted that “bringing out another bottle was like being unfaithful to your wife.”
Relax, the sugar standard remains in place – even though New York Mayor Michael Bloomberg saw the devil named is sugar. The health-conscious mayor tried to save New York residents and visitors from their less disciplined selves. The ban was on 16-ounce beverages containing sugar – but the new policy had a host of exemptions. New York Judge Milton A. Tingling, Jr. saw the devil in Mayor Bloomberg’s commandment which he said was "fraught with arbitrary and capricious consequences.” Mississippi went one step farther than Tingling and banned local governments from limiting portion sizes in what was called the “anti-Bloomberg law.”
Still, Bloomberg had his supporters. New York Times food columnist Mark Bittman wrote: “Sugar-sweetened beverages are nothing more than sugar delivery systems, and sugar is probably the most dangerous part of our current diet. People will argue forever about whether sugar-sweetened beverages lead directly to obesity, but Bloomberg’s ban should be framed first and foremost as an effort to reduce sugar consumption. Good.”
The Los Angeles Times’ Alexandra Le Tellier wrote: “Of course, people will push back and argue that it’s their right to destroy their bodies and risk their lives in whatever way they choose. Some people go to tanning salons, others ride bikes without helmets. When it comes to hazards to our health and safety, what makes soda any worse?”
Well, central banks insist on feeding QE sugar to the national and world economies and few folks complain. Perhaps it is time for a timeout. According to the New York Times, calling a “medical timeout” in tennis is the new in thing. The medical timeout drew criticism some weeks back after Victoria Azarenka defeated Sloan Stephens at the Australian Open semifinals after invoking a medical timeout. QE may bring a temporary sugar rush to the economy – but the long-term consequences are yet to be measured.