Since Augustus has no sons, his nephew Marcellus is one of his closest relative—already at the age of three, when his uncle had needed to make peace with Sextus Pompey, Marcellus had been engaged to a daughter of Sextus (though the engagement was forgotten when Sextus Pompeius was defeated).

As he has grows older, Marcellus has been seen often in public with Augustus, including at his triumphs over Mark Antony and Cleopatra and a campaign against the Cantabri.

In 25 BCE, Marcellus marries Augustus' only daughter, Julia the Elder, with Agrippa officiating in Augustus's absence.

Agrippa's friendship with Augustus seems to have been clouded by the jealousy of Augustus' nephew Marcus Claudius Marcellus, which was probably fomented by the intrigues of Livia, the third wife of Augustus, who fears his influence over her husband.

Roman historians after Augustus' death will claim that Agrippa's sojourn at Mytilene on the island of Lesbos, from which he administers affairs in the East as deputy princeps, was the result of such jealousy.

Agrippa sends only his legate to Syria, while he himself remains at Lesbos and governs by proxy, though he may have been on a secret mission to negotiate with the Parthians about the return of the Roman legions standards that they hold.

On the death of Marcellus, which takes place within a year of his exile, Agrippa is recalled to Rome by Augustus, who finds he cannot dispense with his services.

In the context of the crisis in 23 BCE it seems unlikely that, when facing significant opposition and about to make a major political climb down, Augustus would place a man in exile in charge of the largest body of Roman troops.

It is more probable that Agrippa's 'exile' is the careful political positioning of a loyal lieutenant in command of a significant army as a backup plan in case the settlement plans of 23 BCE fail and Augustus needs military support. (The nature of Agrippa's constitutional power at this time is controversial. It will be argued whether the Senate had in 23 given him an imperium greater than that of any other proconsul, or provincial governor, in the East.)

Horace completes three books of eighty-eight Odes, his most admired work, in 23 BCE.

Admitting frequently to his forty years, he views his and others' enthusiasms, whether amorous or political, with ironic tolerance.

In his call for temperate pleasures, he rejects both unbridled passion and totally dispassionate, impersonal preoccupation with monetary matters.

Speaking with an utterly controlled voice of reason, Horace captures the complex problems of the middle-aged and champions an ideal of rational contentment.

Following Antony's rejection of Octavia, their divorce, and his eventual suicide in 30 BCE, Octavia had become sole caretaker of her five children—two by her marriage to Antony and three by an earlier marriage to Gaius Claudius Marcellus.

Some of the implications of the settlement of 27 BCE are becoming apparent by 23 BCE.

Augustus' holding of an annual consulate makes his dominance over the Roman political system too obvious, while at the same time halving the opportunities for others to achieve what is still purported to be the head of the Roman state.

Further, his desire to have his nephew Marcus Claudius Marcellus follow in his footsteps and eventually assume the Principate in his turn is causing political problems and alienating his three biggest supporters—Agrippa, Maecenas and Livia.

Feeling pressure from his own core group of adherents, Augustus turns to the Senate in an attempt to bolster his support there, especially with the Republicans; after his choice for co-consul in 23 BCE, Aulus Terentius Varro Murena, dies before taking office, he appoints the noted Republican Calpurnius Piso, who had fought against Julius Caesar and supported Cassius and Brutus.

Augustus suffers a severe illness in the late spring of 23 BCE, and on his supposed deathbed makes arrangements that will ensure the continuation of the Principate in some form, while at the same time put in doubt the senators' suspicions of his anti-republicanism.

Augustus prepares to hand down his signet ring to his favored general Agrippa.

However, Augustus hands over to his co-consul Piso all of his official documents, an account of public finances, and authority over listed troops in the provinces while Augustus' supposedly favored nephew Marcellus comes away empty-handed.

This is a surprise to many who believed Augustus would have named an heir to his position as an unofficial emperor.

Augustus bestows only properties and possessions to his designated heirs, as an obvious system of institutionalized imperial inheritance would have provoked resistance and hostility among the republican-minded Romans fearful of monarchy.

With regards to the Principate, it is obvious to Augustus that Marcellus is not ready to take on his position; nonetheless, by giving his signet ring to Agrippa, it is Augustus’ intent to signal to the legions that Agrippa is to be his successor, and that no matter what the constitutional rules were, they will continue to obey Agrippa.