Truth is indeed stranger than fiction, both in the global economy and in our everyday lives. One true story from a recent restaurant experience was so bizarre you’ll think I’m making this up.
On holidays this week, three friends and I found ourselves at a great little restaurant in Toronto. It had all of the best elements that make for great dining—tiny, out of the way, charged atmosphere, full of good looking people enjoying themselves. It was a highly recommended tapas style restaurant with small dishes meant for sharing. Everything was impossibly delicious and the four of us were having a wonderful night.
And then the pretzel bun arrived.
It was a baked sandwich with fancy bacon, a hard to pronounce cheese, and other culinary details you can’t replicate at home, on a tasty pretzel bun a bit smaller than a normal hamburger. Wanting to cut it into four pieces to share, we requested cutlery.
“I’m sorry,” said the server, “We don’t have any cutlery at this restaurant.”
“What? Why not?” we asked.
The server was pleasant but responded, “That’s not the vision of the chef. All of the food here is meant for sharing, so there is no cutlery.” Why would cutlery prevent sharing? we wondered. Determined, we asked our server for a knife from the kitchen. “I know you’ve got knives back there,” quipped one of my friends. The server wouldn’t do it.
It escalated to the point where the head chef of the restaurant came to our table where the pretzel bun was getting cold. He was also very pleasant, but unhelpful. “I have a vision for how I want my food to be presented, and we don’t want cutlery here.”
“Then, could you take the sandwich to the kitchen and simply have one of your chefs cut it into four?”
“No, we can’t do that,” said the chef. “Can you imagine how busy we’d be in the kitchen if everyone wanted their food cut? It’s not possible to do that.” We were bewildered.
“Then could you please bring us a plain old knife, and we’ll cut it ourselves?”
And that was how it ended. No knife, no cooperative chef, no neatly chopped pretzel bun. Just three very puzzled guests (and one who was furious). We managed to mash the sandwich apart with an olive pick and ate the mangled mess. It was delicious.
What does this story have to do with the global economy?
There are probably plenty of lessons (especially around customer service), but what struck me was the strangeness of the whole event. I was sure we were on the TV show Just for Laughs where crazy gags are played and hidden cameras capture the shocked reactions.
The global economy is just as bizarre. We watch with amazement at the prospect of Greece bringing down the global economy. We read with disbelief that leaders of the G20 cannot coordinate their actions. We follow a U.S. election where politicians of the world’s largest economy—teetering on recession—debate 19th century social issues. Like the story of the un-cuttable pretzel bun, it’s just too crazy to be real.
And maybe like diners with no cutlery or helpful server, central bankers around the world must feel bewildered. From the U.S. Federal Reserve to the Bank of England and the European Central Bank, the traditional tools of monetary policy are not working. Either the tools are unavailable like our cutlery (i.e., they can’t lower interest rates any further) or useless like our chef (i.e., printing money through asset purchases isn’t having much effect).
To prevent another major economic downturn, two key things will have to happen.
First, some sort of knife will have to arrive at the table: lowering interest rates aren’t an option, so improvisation with other fiscal or monetary policy tools (like our olive pick) may be needed. Second, even if it’s not within their “vision,” the chefs of the global economy will have to compromise and cooperate. Germany will have to be more patient, Greece will have to follow its commitments, and U.S. politicians will have to set aside partisan hard lines.
Our strange dinner at the bizarre little restaurant ended okay. Unfortunately, much more hangs in the balance for the global economy than it did with our mutilated pretzel bun.
Strange days, indeed!