In the film, Carrey's Truman Burbank lives a peaceful suburban life, but his world collapses upon realizing he's the star character in a massively popular reality show.
His entire life - from his father's death to convenient product placements - has been orchestrated by the show's creator, Christof (played by Ed Harris).
"As Truman starts to unravel the truth, his anger erupts and chaos ensues," Klarman writes to clients in his latest letter.
In Klarman's telling, Ben Bernanke and Mario Draghi play the "creators" who have "manufactured a similarly idyllic, if artificial, environment for today's investors." Check out an excerpt from the rather bearish letter (via ZeroHedge):
But there is one fly in the ointment: in Bernanke's production, all the Trumans - the economists, fund managers, traders, market pundits - know at some level that the environment in which they operate is not what it seems on the surface. The Fed and the Treasury openly discuss the aim of their policies: to manipulate financial markets higher and to generate reported economic "growth" and a "wealth effect." Inside the giant Plexiglas dome of modern capital markets, just about everyone is happy, the few doubters are mocked and jeered, bad news is increasingly ignored, and markets go asymptotic. The longer QE continues, the more bloated the Fed balance sheet and the greater the risk from any unwinding. The artificiality of today's markets is pure Truman Show. According to the Wall Street Journal (12/20/13), the Federal Reserve purchased about 90% of all the eligible mortgage bonds issued in November.
...Every Truman under Bernanke's dome knows the environment is phony. But the zeitgeist so so damn pleasant, the days so resplendent, the mood so euphoric, the returns so irresistible, that no one wants it to end, and no one wants to exit the dome until they're sure everyone else won't stay on forever.
A marketplace of knowing Trumans seems even more unstable than the movie sound stage character slowly awakening to reality. Can the clued-in Trumans be counted on to maintain their complicity or will they go off-script? Will Fed actions reliably be met with the desired response? Will the program remain popular? Could "The Truman Show" be running out of material? After all, even Seinfeld ended.
"When the show ends, those self-deluded Trumans will be mad as hell and probably broke as well," Klarman concludes. "Hopefully there will be no sequels."