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Alan Greenspan: He did it his way

Alan Greenspan is worried about his reputation and is trying to set the record straight in an interview with Rupert Murdoch’s Wall Street Journal. I was prepared to be sympathetic after reading this quote:

"I was praised for things I didn’t do," Mr. Greenspan said during one
of three interviews at his sun-drenched office in downtown Washington,
D.C. "I am now being blamed for things that I didn’t do."

But then the reporter tells us that the former Federal Reserve chairman "doesn’t regret a single decision." This makes my bullshit detector go off. How could any thinking person live a full life, especially one at the pinnacle of international leadership, and say with a straight face they have no regrets. Even Frank Sinatra had a few.

Greenspan wants us to draw the correct lessons from his tenure and the current market disaster, so that we don’t implement the wrong policies. But what if the wrong policies are the very ones implemented on Mr. Greenspan’s watch?

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Blond coed hooker Wall Street destroys economy

“How are you supposed to know? Fucking men like you built the hydrogen bomb. Men like you thought it up. You think you’re so creative. You don’t know what it’s like to really create something; to create a life; to feel it growing inside you. All you know how to create is death…and destruction.”

These are the lines Linda Hamilton speaks in Terminator 2. Change a few words and she could be speaking of the current financial disaster. Now it’s out of control. Make no mistake: the extraordinary steps by the Federal Reserve in the past few days, including a Sunday night fire sale of Bear Sterns and an interest rate cut, are being taken out of fear.

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Wishful-thinking stimulus

There’s a great deal of silliness and sophistry about the economy at this dangerous moment, but why should it be different from anything else in American life?

Washington debates a “stimulus” package of tax cuts and newspapers write headlines to tell “average readers” (whatever the hell that means) that the feds will put hundreds of dollars in their pockets. Wall Street does a dead-cat bounce and commentators who were darkly warning of recession are now talking about a miraculous comeback. In the New York Times, the normally sensible David Leonhardt was saddled with a headline that emblemized the silliness: “Worries That the Good Times Were Mostly a Mirage.”

In reality, the economy risks finally tipping over from a series of imbalances and forces long in the making. The Fed is very limited in its ability to right the ship. And any “stimulus” risks making things worse, aside from extending unemployment benefits, which is somehow anathema to “conservatives.”

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