It started with Tom Friedman’s McDonald’s Theory of War:

No country with a McDonald’s outlet, the theory contends, has ever gone to war with another.

which was based on the premise that countries with an educated middle class that would sustain a McDonald’s are less likely to go to war…this theory held since 1996 until Georgia and Russia fought this past summer. Perhaps, they needed more happy meals?

Dan Gross brings us the Starbucks theory of international economics: >The higher the concentration of expensive, nautically themed, faux-Italian-branded Frappuccino joints in a country’s financial capital, the more likely the country is to have suffered catastrophic financial losses. Gross contends that Starbucks fueled the housing boom as “The Seattle-based coffee chain followed new housing developments into the suburbs and exurbs, where its outlets became pit stops for real-estate brokers and their clients. It also carpet-bombed the business districts of large cities, especially the financial centers, with nearly 200 in Manhattan alone.” Incidentally, the company is named for Captain Ahab’s first mate – Starbuck in Moby-Dick.

Well I’ve got my own (admittedly very thin, but please give it to me, I’ve never had an economic theory before) economic theory/correlation/indicator: Pirate theory of credit crunch aversion:

It’s been exactly two months since Talk Like A Pirate Day and apparently pirates are dominating the high seas (well, it pays better than fishing).

My pirate theory goes like this:

[Take a look at the ICC Commercial Crime Services Piracy Map for 2008.]

Piracy (the boarding of ships to steal their cargo) originates from countries that didn’t participate in the credit market run-up – namely participate in the proliferation of faulty mortgage securities that wreaked havoc on much of the global financial system. According to recent news, poor countries with limited financial sophistication tend to be the source of much the pirate activity.

(the map shows the locations of the activity, not the source)

What does this all mean? Well for starters, pirates are not likely eating at McDonald’s for lunch while sipping a mocha frappuccino grande with enough whipped cream to be esthetically pleasing, after boarding a container ship full of tanks and guns.

And they don’t have a 2/28 subprime ARM with a 2% teaser rate about to reset to a fully indexed rate of 11% with a significant pre-payment penalty. They merely get paid the ransom for the crew or get shot.

And of course, Somalian coffee served at Starbucks is quite good.

UPDATE: Infectious Greed: Somali Pirates and TARP

UPDATE2: Freakonomics: Spreading the Pirate Booty Around

arrgh!

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11 Responses to “Pirate Theory Of Credit Crunch Aversion”

  1. Pete Flint says:

    What a great post! Thank you

  2. Thanks Pete…Aargh! Pirates can explain everything. Aye…

  3. Elliott says:

    How can you have a pirate theory without mentioning Pastafarianism and the link between pirates and global warming?

  4. Good point elliot. Check back later and I’ll explain

  5. Edd Gillespie says:

    Do see any alternative to living with Wall Street or Piracy?

  6. Yo Ho Ho for the Pirates and the Bailout Bums

    (Deadman’s Chest)

    WilliamBanzai7

    The year 2008 has been one big treasure hunt For Somali Pirates and Bailout Bums Bankers and tankers and the devil done for the rest Yo ho ho for the Pirates and the Bailout Bums.

    Wall Street bankers plundering Paulsens’s TARP

    Somali pirates cruising in Donzis and living high on the hog

    An AK47, a cutless and a GPS

    A subprime CDO, a SIV and a CDS

    Yo Ho Ho for the Pirates and the Bailout Bums

    Wall Street’s creed is a sea of greed

    The pirates creed is take whatever you need

    Bankers and pirates are one and alike Take what you want and screw who you like; Yo ho ho for the Pirates and the Bailout Bums

    Is it better to be done by a banker or a scurvey ridden scrum?

    Better yet, a Somalian banker pushing securitized Wall Street dung! Lets pump AIG and send Detroit the crumbs!

    Lets steal some crude from those Arabian skunks!

    Yo ho ho for the Pirates and the Bailout Bums!

  7. TheWord says:

    What does it mean? It means Africans make the best pirates. Arrrrr!

  8. JDallas says:

    That was a very interesting post. I especially love the relations drawn between Starbucks , McDonalds (the epitome of Americanization and globalization) and more serious things, such as piracy , the housing crisis and the credit crunch

  9. […] in ransom to release an oil laden Saudi tanker. Aargh! and read more.Anyway, with a hat tip to Jonathan Miller at Matrix who always celebrates Talk like a Pirate Day every September 19th and magically relates piracy with […]

  10. Hey I need some money arrrrr me mates show me the money