Transactions: June 8, 2009

Who knew? Ben Bernanke, poet laureate. Whitman had "Leaves of Grass," Ben has "green shoots." Ben's economic descriptive "green shoots" has evolved into various lawn cultivation themes (subjects I am familiar with), from crabgrass to yellow weeds to digressions on the pharmacopeia ("smoking green shoots"), which actually seems strangely appropriate. But it goes further. Economists have engaged in a frenzy of metaphor production as they attempt to make sense of a situation that eludes them, confronting, as Paul Krugman admitted a few weeks ago, "weird times like the present when many of the normal rules no longer apply." This apparently liberates them to free associate, producing metaphors that take on lives of their own, like Jack's giant bean stalks. Indeed, it has been quite a sight to see a bunch of pundits tossing U, V, W and L recoveries around, then gestating fantastic variations on them; this explains (sort of) the mentality behind particle physics, securitization and St. Thomas Aquinas. If Ben is a ninth-rate Walt, the alphabet gang is more like off-the-street Elmos, Ernies and Big Birds trying to cram the world into four little letters for an audience of, well, preschoolers.

Krugman's "weird" comment is a brief admission of reality. Krugman usually sounds as certain as God; this makes sense, since God makes rules, rather than follows them, which is the Nobelist's usual attitude. Generally, however, prognosticators cannot seem to admit that their view of things is as murky as that of the average 401(k) investor. The reason is not their technical grasp of economic mechanics, which is impressive. The reason is that they have -- to be kind -- a primitive sense of how their fellow beings react to fluid stimuli. Hell, half the time none of us know how we'll react if, say, we suddenly collapse into a midlife crisis. Our metaphors for this situation are pathetic fig leafs over -- well, let's avoid vulgarity. Ponder this instead. "Green shoots," as trite as it is, is a relativistic metaphor. In March, when Ben uttered it, the lawn resembled a cinder track. We had nothing. (Actually, we had less than nothing, given that most indicators were transmitting from the dead zone of the fourth quarter.) Now we have something. Perhaps Ben tossed off "green shoots" thinking about the V-shaped recovery that would power us back to 2006, or perhaps he was pretending to be a glass half full. But in a random sample, mostly involving myself, I think that the current we-have-sidestepped-the-apocalypse is just fine. As an expert on bad lawns, a few green shoots that may be weeds beats dirt.

Yes, yes, the future is grim. Everyone seems to know that, except those investors who keep selling bonds and buying stocks. But tomorrow, the W prediction will undoubtedly come dancing out, though it may be a W with an L attached, like a broken arm. And, yes, there is deflation looming, and, on top of that, inflation. This about covers it. Several weeks back, just as deflation faded, Treasury yields spiked. The crabgrass alert sounded. Pundits launched their Ws; don't get excited you silly ignorati dreaming of a V (which, by the way, always reminds me of Thomas Pynchon's novel "V" in which that letter becomes a symbol of metaphorical promiscuity and insanity, not to say the visible representation of paranoia as an organizing principle from God's authorial perspective), we're heading five fathoms deep. A few days later, Treasury yields inexplicably fell. But don't be fooled, you popeyed optimists. Gird your loins. Assume the fig leaf.

And yet it feels as if we're missing something. Consider this. We have suffered from a dread disease. We will only cure ourselves if we repent. But repentance never occurs overnight; it's long, hard, bitter. If we recover too quickly, we'll return to the euphoria of our previous "healthy" -- or is it "unhealthy?" -- state. A V recovery, accompanied by green shoots, is thus an unhealthy attempt to get healthy, and it won't work, hence the W or L. Instead, we must remain sick as swine until we've learned our lesson, which could last as long as, say, the Great Depression. That way, when recovery arrives, we will be so beaten down, we will look at a small patch of suspicious greenery and smile. In short, all these metaphors are profoundly relative, and vaguely metaphysical. We will recover when we have accepted the grim terms mandated for recovery. We will prosper when we eschew the green lawns of the past, and embrace the onion grass, crabgrass and clover of tomorrow. There are times, one must admit, when it feels like we are imprisoned by bad metaphors from economists who have misplaced their rules. Sometimes it feels as if this is the very crisis itself.