The bald eagle is an icon that symbolizes American ideals and spirit. The image rode Westward stamped on the lockplates of firearms carried by explorers and settlers, landed in Normandy for the liberation of Europe, rests on the Sea of Tranquility, and even adorns your 4th of July ice cold Bud .
However, here’s a short story about an earlier icon and our oldest founding father. Ben Franklin published a satirical commentary in 1751 that the colonists should send rattlesnakes to England as a thank you to the Brits for sending their felons to America. In a more serious tone during the French and Indian War, he later used a political cartoon asking for unity amongst the colonists. The snake was cut in 8 sections representing the individual colonies, curved like the coastline, with the words “Join, or Die.” It played on the superstition that a chopped up snake would come back to life if the pieces were rejoined by sunset.
Variations of the snake symbol later emerged reflecting liberty and freedom as tensions with England grew. No longer cut up in pieces, the serpent battled a British dragon. In December 1775, Ben published an essay under the pseudonym “American Guesser.” He had seen Marines preparing to board Continental naval warships and carrying drums, each painted yellow and adorned with a fierce rattlesnake coiled to strike and “Don’t Tread on Me.” The popularity of the rattlesnake symbol grew.
He wrote “the rattlesnake is found in no other quarter of the world besides America… Her eye excelled in brightness and she may therefore be esteemed an emblem of vigilance… She never begins an attack, nor when once engaged, ever surrenders – She is therefore an emblem of magnanimity and courage… She never wounds til she has generously given notice, even to her enemy, and cautioned him against the danger of stepping on her. Was I wrong, Sir, in thinking this strong picture of the temper and conduct of America?”
That image of a coiled rattlesnake and “Don’t Tread on Me” became one of America’s first flags, the Gadsden Flag. The rattlesnake was adopted by the Continental Congress, and along with the motto, “This we’ll defend,” has been part of the US Army’s pledge for 240 years.
And in current events, news commenters blast the Greek debt crisis, and fears of contagion and the break-up of the EU. Greek’s PM Alexis Tsipras and his Syriza Party seek freedom from the European Union and the austerity measures demanded by the bankers. They failed to make their debt repayments, and the money spigots have been turned off. European Council President Donald Tusk said “Europe wants to help Greece, but can’t help anyone against their own will. Let’s wait for the results of the Greek referendum.” A more colorful analogy was commentator Jeff Macke – “Greece is Europe’s ne’er do well kid refusing to work. German is harsh but enabling mother.”
How can Greece, the physical size of Alabama and economic output equivalent to Boston, cause such a stir in global economics? Perhaps the EU would have been better off without Greek membership – a country prone to economic woes, excessive government spending at 59% of GDP (the long term average in the US is about 20%), and corruption. Tax dodging is a national sport. Per a Columbia University paper, professionals reported that about all their income goes to personal debt repayment. However, it’s not a debt issue. It’s an underreporting issue – professionals, including doctors, accountants and lawyers, reported average monthly income of about $1,800. And the Greek tax collection chief, Harry Theoharis, resigned after just 17 months attempting to crack down on tax evaders and threats of “break your legs.”
A more important question you should be asking is “What relevance is the Greece situation (or other crisis du jour) to my financial well-being?” Markets hate uncertainty, are globally connected, and they’re complex. That’s why it’s important to have a plan, balance returns and risks (diversify), and keep your wits as you make adjustments for life’s surprises .
Are you weary of low interest rates on your savings? Which would you take if offered a 2.3% or 14.5% return per year on your investment? Those are the rates on 10-year US Treasuries and Greek bonds, and illustrate the risk-return trade off. Good luck and don’t let hype or fear tread on you.