18 February 2010
Nuclear Test
If there actually were something like nuclear winter, I imagine it would be something like this. The temperatures have stayed near freezing during the day since the great snowfalls blanketed the city, and have plunged below it at night.
The sky has been mostly gray, and the breeze is filled with chill moisture. Ugh. What fell is now stacked adjacent to the paths that were shoveled out.
I slipped and slid over to Willow last night to have a long deferred birthday dinner with my son. It was an excellent meal, in keeping with the high standards of the establishment.
They featured a delicious smoky red wine- a Malbec- that complemented each course with a rich tannic aroma and subtle but intense burst of flavor.
Although this bottle was from California, my son noted that it was the equal of the Malbecs he had sampled in Buenos Aires. Although the inky black grape originated in the southwest of France, it is increasingly celebrated as the basis of an Argentine varietal wine that enhances the bold cuisine of the pampas.
It was a thrill to note the experiences of his life, still young in the career, and he welcomed some advise from an older Spook, since he has some choices coming up.
He thought he might like to write for the I&R folks at State Department some day, since they are the only ones whose cables have a voice tinged with distinct and ironic commentary.
Everyone else in the community writes like they have a stick up their butts.
I advised him to broaden his portfolio of experience with something technical, if he had a chance. That would increase the odds of getting a job with one of the big aerospace concerns in the military-industrial complex, if he decided to leave the government.
His experience thus far has been in regional military and governmental affairs, and like assholes, I said, everyone can have an opinion about those sorts of things with need for hiring an expensive consultant.
He nodded in agreement, but I opined that it was likely in the coming storm that a decent government job was about the best thing you could possibly have.
Willow is pleasantly dim at this time of the year, and the salad course was superb. The dining room filled up. I could hear discussions of travels to distant and warmer climes. Islands in the Caribbean seemed to be a topic of common concern, along with Mexican beach vistas.
I asked him what he thought about the recent limited nuclear test. My son is a pro now, and it fills me with pride to hear his views on all manner of things.
On this he looked quizzical.
“I mean what the Chinese did in December.”
“There was no nuclear testing at Lop Nor,” he said, wondering what his drifty father was getting at.
“It was just a demonstration, I think. Treasury just came out with the numbers for last December. T-bills fell by a record amount as the Chinese dumped $34.2 billion out of their holdings.”
“Oh, it is one of your damned metaphors,” he sighed. “There was going to be an inevitable shift from the “flight to safety” strategy everyone adopted in the worst of the recession. It is only logical.”
“Metaphor or not, it is trifling with something really big- a fiscal nuclear event that could cause a chain reaction. I think it was intended to demonstrate that they are going to follow through on what they said last summer. They are saturated with US paper, and that means we are going to look to other countries for financing our debt. So far, Japan and the UK are picking up some of the slack, but that cannot go on forever, particularly if the Euro melts down.”
“Greece is a unique case,” said my son. “Germany can fix that with pocket change.”
“Spain is more problematic,” I said, taking a sip of smoky Malbec. “But the monthly sell-off of American T-bills was the biggest on record, almost $53 billion. That is going to add pressure to increase interest rates, which could stall the recovery.”
“The problems with the Euro are going to support continued demand on US paper,” said my son. “Demand will stay solid.”
I nodded in agreement. “I think you are completely right. And I think the Chinese are just testing the waters on a new capability. They are pulling on the levers to see what sort of influence on US policy they can exert. They don’t want to melt us down, or at least not yet. They hold too much of our debt to want that. Out of control inflation here would affect them, too, and right where they live.”
The entrée arrived, with creamed spinach on the side and marvelous little stuffed potatoes.
“The Chinese just let the Nimitz strike group make a port visit in Hong Kong,” said my son thoughtfully. “Coming so soon after the dust-up over the arms sales to Taiwan, that is clearly a conciliatory gesture.”
“You are right, and I think it is OK for the moment,” I declared, picking up my fork. “But I think we just saw Beijing tug a little bit on the handle to see what would happen.”
“You could be right, Old Man.”
“I would recommend keeping a government job if you have one. The President is going to meet the Dalai Lama today, and goodness knows what the Chinese are going to do about that.”
Dinner was superb. You really should try Willow next time your are in what is still- at the moment- the capital of the Free World.
Copyright 2010 Vic Socotra
www.vicsocotra.com
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