The Climb
The three climbers steadily made their way up the rock face. The day was bright and clear and the climb had been great so far. This was the first time that Annie had taken the lead on a climb. Roped behind her were her brother Peter and her father Royce, a world famous climber. They stopped to rest before a particularly difficult and technical part of the climb when it happened.
One of Royce's pitons (a small metal spike driven into the rock to hold the rope) pulled out sending him hurtling off the wall in a freefall. As the rope stopped his fall it jerked violently on Peter and Annie pulling out yet another piton and loosening two more. Since they were all currently on a near vertical face, and Royce was only semiconscious it was impossible to pull him back up. His hanging dead weight was putting a huge strain on both of his children clinging to the wall as well as the remaining pitons holding them all. All climbers know and fear what is called the "zipper". The "zipper" is when a climber falls and his momentum begins stressing both the other climbers and the remaining pitons until one by one they all "zipper" off the wall. As Annie screamed Peter did what was both unthinkable and necessary for the survival of his sister and him. He cut Royce's rope.
The paragraph above describes the opening scene of a movie called "Vertical Limit" made in 2000. Although overly dramatic (as movies usually are) it accurately illustrates the ramifications of a critical debate in the climbing world that has important parallels to today's financial environment.
One of Royce's pitons (a small metal spike driven into the rock to hold the rope) pulled out sending him hurtling off the wall in a freefall. As the rope stopped his fall it jerked violently on Peter and Annie pulling out yet another piton and loosening two more. Since they were all currently on a near vertical face, and Royce was only semiconscious it was impossible to pull him back up. His hanging dead weight was putting a huge strain on both of his children clinging to the wall as well as the remaining pitons holding them all. All climbers know and fear what is called the "zipper". The "zipper" is when a climber falls and his momentum begins stressing both the other climbers and the remaining pitons until one by one they all "zipper" off the wall. As Annie screamed Peter did what was both unthinkable and necessary for the survival of his sister and him. He cut Royce's rope.
The paragraph above describes the opening scene of a movie called "Vertical Limit" made in 2000. Although overly dramatic (as movies usually are) it accurately illustrates the ramifications of a critical debate in the climbing world that has important parallels to today's financial environment.
To Rope Or Not To Rope
One of areas of often heated debate and difference in the climbing world revolves around the discussion of whether climbers should rope together while climbing. One side of the argument states that it is crazy not to rope together. The theory is that if one climber slips and begins to fall the other climbers who are roped to him can arrest his fall, thus saving his life. The other argument is, however, also compelling. This asserts, as the opening paragraph illustrates, that the fall of a climber is often sudden and violent and can put the whole team at risk. Better to lose one climber than the whole team.
The key point here is that the decision to rope together (or not) occurs before the climb begins. You either head up the mountain roped together or not. This forces the decision, in the event of a catastrophe, that you might actually have to cut someone's rope to save the rest of the team. You can guess the psychological and relationship ramifications on the team of that decision.
The key point here is that the decision to rope together (or not) occurs before the climb begins. You either head up the mountain roped together or not. This forces the decision, in the event of a catastrophe, that you might actually have to cut someone's rope to save the rest of the team. You can guess the psychological and relationship ramifications on the team of that decision.
The Fear Of The Global Zipper
As we all know there has been endless discussion and writing about the creation of a global economy for decades now. This new global economy was going to make commerce seamless between nations and allow all everyone to participate in the new era of prosperity. Well as the saying goes, be careful what you wish for. I believe we truly are operating in a global economy today. The economic and political interdependencies between nations today are unparalleled. In essence, at the start of the climb we made a decision to "rope together" for the benefit of all. As we all know the economic events of the last 20 plus months have forced our "climbing team" to traverse some very treacherous and dangerous terrain. We are both tired and weakened (think debt) by this arduous portion of the climb. What would happen if someone fell?
In essence, Greece already has. The closest climbers to Greece, roped together by the Euro, have had to withstand the stress of her falling off the wall. There has already been debate among the Euro climbers about whether to cut Greece loose or not. The decision, for now, has been to try and pull her back onto the wall. Spain, Portugal, Ireland, and others are also losing their grip on the wall. What if one, or more, of them also fall?
More importantly remember in a truly global economy we are all now roped together. If the Euro climbers start to zipper off the wall the momentum of their fall will be felt throughout the remainder of the world including the major economies of the US, China, and India. Like the climbers in the opening paragraph, we are now in a situation where we both need each other and are a danger to each other. This will force each climber to make a very difficult decision. Stay roped to try and stabilize everyone or cut loose to save yourself.
The ramifications of these decisions, both economically and politically, will be felt for decades.
At The Rockland Group we help businesses navigate through this challenging terrain.
In essence, Greece already has. The closest climbers to Greece, roped together by the Euro, have had to withstand the stress of her falling off the wall. There has already been debate among the Euro climbers about whether to cut Greece loose or not. The decision, for now, has been to try and pull her back onto the wall. Spain, Portugal, Ireland, and others are also losing their grip on the wall. What if one, or more, of them also fall?
More importantly remember in a truly global economy we are all now roped together. If the Euro climbers start to zipper off the wall the momentum of their fall will be felt throughout the remainder of the world including the major economies of the US, China, and India. Like the climbers in the opening paragraph, we are now in a situation where we both need each other and are a danger to each other. This will force each climber to make a very difficult decision. Stay roped to try and stabilize everyone or cut loose to save yourself.
The ramifications of these decisions, both economically and politically, will be felt for decades.
At The Rockland Group we help businesses navigate through this challenging terrain.
You wouldn't climb without a guide, why manage without one?
Bill Gately
Principal - The Rockland Group, Inc.
(781)-710-4064
bill.gately@rockland-group.com
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