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02 August 2013

Alice in the Washington Wonderland

Alice had been getting very excited; since her visit to Brussels a couple of months ago, she’d got the travel bug, and now she and some of her friends were off to the United States. And not only the US; they were going to see the very heart of the Government, up on Capitol Hill.

Disappointed in Brussels

In truth, she’d been a bit disappointed in Brussels; she’d expected to meet lots of really clever people, but in the end she had come away with the idea that she was smarter than they were, even though she was just a little girl. Still, the US had got to be different; the most powerful democracy in the world! And she was going to be able to sit and listen to some of the discussions!

Now, as you know, over the last couple of years, Alice has been getting quite interested in the metal market, so she was particularly pleased to learn that she was going to get to hear the discussions of part of the Senate Committee on Banking, Housing and Urban Affairs. It sounded a bit dull to start with, but then she found out that they were going to be talking about LME warehousing of metals. She was bouncing on her toes as she queued with the Mad Hatter and the March Hare to get into the building. She just knew she was going to learn a lot from these clever people debating in the Chamber.

Attack on LME Rules

Some of the people sitting in that Chamber looked grumpy to Alice. When they started speaking, she soon found out why. They weren't happy, at all. The LME Rules, they said, were arcane and hard to understand.

Alice shook her head at that. She’d read the rules, when she’d been talking to people about metals before, and they weren't too difficult; true, some of the words were long, and some of the rules dated back to an earlier time, but it wasn't difficult to understand them, with a reasonable grasp of English. Alice wondered if perhaps the man who made this statement was confusing his dislike of the rules with an attack on their comprehensibility. She knew that sometimes, not when she was in Wonderland, but when she was at home, she claimed she couldn't understand something when really she just didn't like it.

Cost of Aluminium Cans

The next person to speak was from a company that put drinks into cans. Alice was definitely keen to hear what he had to say; she loved to have a fizzy drink now and then. This man told them that some very powerful financiers had been able to influence the price of aluminium, and that made each can of drink a tiny bit more expensive.

The Mad Hatter, frankly, had been dozing off. But then the speaker mentioned beer, and his ears pricked up. I’m sure you all know about the Mad Hatter’s Tea Party, but have a look under the table there one day, and see what his real preferred drink is. He started shaking his head and tut-tutting about the thought of beer being more expensive than it need.

But then he looked at the March Hare, who had pulled some papers out of his pocket and was sitting hunched over them, pointing something out to Alice. She nodded firmly and jabbed the Mad Hatter in the ribs with her elbow.

Flaw in the Argument

“Look,” she said, “this is a graph of the aluminium price. He said that because of what those financiers have done, the people are paying more than they need. Well, I don’t know about ‘need’, but the price has definitely gone down quite a long way, so surely people should be paying less, not more?” The other two nodded sagely. Alice had put her finger on the flaw in the argument.

Frankly, they were beginning to lose interest a bit. The discussion went on, with one man claiming that the LME warehouses meant he had to wait too long for his metal because there was a queue created by the financiers. Alice knew that was silly, because only a couple of days earlier, a man from an aluminium smelter had told her that he was just waiting for customers to come and buy his metal – and he wouldn’t be imposing any delay.

 “All this talk of beer is making me thirsty,” said the Mad Hatter. “Come on, let’s go.”

As they left the building, they bumped into one of the financiers. “You know what?” he said. “We can swap queue aluminium for aluminium from our other stocks, easily. D’you think that will satisfy them?”

Understand it to solve it

Alice looked at him. The Washington Wonderland didn't seem any more sensible than what she’d seen in Brussels. Slowly she shook her head. “I’m afraid not. Too many people who don’t really think properly about the whole problem just love the sound of their own voices. I think they’ll be arguing for a long time yet. Until they've understood it, they can’t solve it.”


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