Jig is Up for Greenspan

The New York Times quietly destroyed Alan Greenspan last week. In Peter S. Goodman’s ‘Taking Hard New Look at a Greenspan Legacy’, he calmly runs through the various reasons why Greenspan has an inescapably enormous responsibility to bear for the current disaster. It feels like watching a very reasonable, rational doctor telling Greenspan’s reputation it has terminal lymphatic cancer, and two weeks to live.

 Among highlights include his portrayal of Greenspan as a lackwit populist Nietzschean:

“A professed libertarian, he counted among his formative influences the novelist Ayn Rand, who portrayed collective power as an evil force set against the enlightened self-interest of individuals. In turn, he showed a resolute faith that those participating in financial markets would act responsibly.

An examination of more than two decades of Mr. Greenspan’s record on financial regulation and derivatives in particular reveals the degree to which he tethered the health of the nation’s economy to that faith.”

By the time he gets around to describing how Greenspan actively campaigned to destroy the Commodity Futures Trading Commission, a vitally important regulator of the derivatives market, the character assassination is virtually complete. Being cast as not just anti-regulation, but aggressively so to the point of manipulating Congress to dissolve regulatory bodies entirely, is in the current climate tantamount to being accused of, well, another morally abhorrent form of fiddling.

OK, and if you don’t believe it’s over for Greenspan, that it’s open season, just take a look at Italian Finance Minister Giulio Tremonti’s recent comments:

“‘Greenspan was considered a master. Now we must ask ourselves whether he is not, after bin Laden, the man who hurt America the most.”

Ouch?!

Posted by Daniel Stacey in Hot Money | October 12, 2008 2:33AM |