The Referee's a Banker

 | Sep 09, 2011 | 8:00 AM EDT
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European indices fell modestly in midday trading Friday, with London down about 0.7% and Frankfurt and Paris down more than 1%.

For more intriguing numbers, New Zealand kicked off the Rugby World Cup with a 41-10 win over Tonga.

Stateside there's about as much interest in rugby as there was over Greek bonds a couple of years ago, even though the USA is represented. Perhaps nobody really wants to see the national team take it right between the eyes from two of the PIIGS (Ireland and Italy are in our group). Or it could be just unfamiliarity.

But in many ways the game is like the eurozone debt crisis: easy to follow on a cursory basis, but almost impossible to master when you get into all the rules and regulations.

In the most basic of terms, in rugby you can't pass the ball forward and you run up the field attempting to touch the ball down across your opponents' end line. This is called a try.

While not a noun in the eurozone sense, "try" is the most operative verb. This weekend, leaders from the G7 will try and assure the world that the West is not tumbling into recession. They will try and prompt banks to lend and bolster consumer confidence. They will try and counteract everything they said a week before that spooked the market. And they won't convert.  

Rugby gets more complicated given that many matches are decided on kicks and field position from penalties being awarded. This is where most casual fans glaze over. It can seem so arbitrary that the referee is miked up for the whole game so those watching can understand why he just decided what he did. (You can even get a headset at the stadium to hear the referee if you're watching live.)

Basically, there's a pile of more than 20 guys and somebody did something almost imperceptible on TV that could suddenly alter the whole game.

That's what we've got as Greece starts to collect responses from the private sector about who's interested in participating in the debt exchange needed for Greece to meet the conditions of the first rescue package. The whole thing is going to be opaque from start to finish and all we really know it that it will pretty much take full participation for it to work.

Beyond that, it's as clear as the offside rule.

Even European banks have no idea who will do what and who is holding what, which is why they are now refusing to lend to each other. That short-term funding slack has been taken up by the ECB, but the central bank won't be able to keep it up indefinitely.

The solution is to name somebody official EU debt referee and just let him or her explain exactly what's going on in a weekly bulletin. Trichet's looking good. He's got some free time coming and almost lost it in a pure Col. Jessup moment at the press conference Thursday.

Whether we accept the explanation or not is irrelevant. It would just limit it to one person we can boo.

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