Greenspan "successfully navigated U.S. economy through the past decade??"

[Bush_Eats_Beef]

COMMENTARY
By Michael Mandel

Greenspan's Signature Achievement
Sure, he kept inflation at bay, but his real legacy will be successfully navigating the U.S. economy through the past decade's booms and busts

http://www.businessweek.com/bwdaily/dnflash/oct2005/nf20051024_3284_db042.htm

When Alan Greenspan took the helm of the Federal Reserve in August, 1987, he was lauded as an inflation fighter. Indeed, one of his first official actions was to push up interest rates to cool down the economy.

Eighteen years later, with President Bush naming Ben Bernanke as the next Fed chief (see "Bernanke Gets His Chance") and Greenspan coming to the end of his long tenure as Fed chairman, the current chief's success with inflation is unquestioned. Taking out volatile energy and food prices, consumer inflation is still running at under 2%, compared to 4% when Greenspan came into office. That's a great performance.

In my view, however, Greenspan's real legacy is going to be something very different: His ability to successfully navigate the U.S. economy through the booms and busts of the past decade. Unlike past central bankers, he wasn't scared of booms, and he wasn't interested in bringing down the stock market, even when it soared to outrageous heights in 1999 and 2000. Instead, he focused on cushioning the blow to the financial system and the economy when the tech and the stock market booms finally came to an end.

CORRECT PATH. This policy of letting the economy "run hot" has so far shown huge benefits, without any big costs. As the unemployment rate dropped below 5% in mid-1997, Greenspan came under enormous pressure -- both from Wall Street and within the Fed -- to raise interest rates. The fear was that excessively tight labor markets were going to trigger an inflationary spiral unless the central bank quickly took action.

[marmar]

1. And now we're heading for an iceberg.

Thank You Capt. Smith. Greenspan is a shameless political hack whose lack of cajones when it comes to this administration's foolish economic policies is going to sink us. Fuck off, Alan.

[ladjf]

2. What a joke!

Greenspan did everything he could do to wreck the securities markets
while running up the prices on bonds, therefore increasing the value of his personal bonds accounts. That was a flagrant conflict of interest.

[louis-t]

3. Greenspan is not as great as he thinks he is.

He helped turn a healthy economy into a recession with excessive interest rate hikes in the late '90's. He's doing the same now with a mediocre economy.

[European Socialist]

4. He can barely criticize the job Dumya has done with the economy.

Sen.Kent Conrad ND has been sounding the alarm for 4 years about Bush deficits. He should be the next Fed Chairman.