You are the voice of truth!
Henry
Doug Henwood wrote:
> Financial Times - May 26, 1999
>
> <http://www.ft.com/search97cgi/vtopic?action=view&VdkVgwKey=%2Fapache%2Fdocs%2Fh
> JUST WHAT'S SO GREAT ABOUT GREENSPAN?
>
> >From Mr Doug Henwood.
>
> Sir,
>
> Your editorial on whether the chair of the Federal Reserve deserves a
> fourth term ("A successor to Mr Greenspan", May 24) is suffused with the
> usual hagiographical boilerplate: "golden reputation", "superb record" and
> so on. Such statements have reached that status where their mere citation
> is enough to make the case, the need for evidence having been assumed away
> long ago.
>
> But what exactly has Mr Greenspan done to earn this reputation? Shortly
> after he ascended to his throne, there was a stock market crash, caused in
> part by his mettle-proving tightening. Yes, he reacted to that crisis with
> soothing words and liquidity injections - but that bail-out gave the US
> leveraging mania a new lease on life, leading to the exuberant terminal
> climaxes of the thrift industry and the leveraged buy-out madness.
>
> Mr Greenspan, of course, did nothing to resist this despoliation of the
> national balance sheet, which left a hangover it took years to recover
> from. To hasten that recovery, Mr Greenspan had to push US interest rates
> to very low levels and keep them there, a regimen that finally revived the
> real economy around 1993, but which also helped give birth to one of the
> most extravagant bull markets of all time. And while that bubble has been
> inflating, we've had the Mexican crisis of 1994-95 (partly caused by his
> excessive tightening in 1994) and the Asian crisis of 1997-98 (partly
> caused by the Mexican bailout he helped engineer).
>
> And during his term in office, US net foreign debts have increased by
> $2,400bn, a development that almost no one pays attention to in this era of
> American triumphalism. That massive capital inflow is the dirty little
> secret of the Clinton boom, the fortunate by-product of the wreckage of a
> good bit of the outside world's economy.
>
> If this is a superb record, what would a bad one be?
>
> Doug Henwood,
> Left Business Observer,
> 250 W 85 St,
> New York
> NY 10024,
> US
>
> [Textual note: the following sentence was originally the second sentence of
> the second paragraph, but it was edited out: "Let's leave aside his
> prehistory as a mediocre economic forecaster, Ayn Rand protege, Republican
> party hack, and (paid) character witness for S&L felon Charles Keating."]