Thursday, April 8, 2010

Don Corleone and Alan Greenspan?

Alan Greenspan was testifying before Congress yesterday and it was obvious he still doesn't understand his primary role in creating not one, but TWO, investment bubbles during his watch as Fed Chairman.

NASDAQ, 1999
Real Estate, 2007

As regular readers of this blog and my other writings know, I'm not a fan of Mr. Greenspan or his successor, Mr. Bernanke.  I wouldn't hire either one of these guys to run a cash register at a 7-11, let alone run the Central Bank of the United States.  There isn't a thimble's worth of common sense between them.

But Greenspan has gone from an idol in the financial world to a pariah in just three short years.  And he still believes his "Greenspeak" song-and-dance pony shows can charm the masses, holding sway over public opinion as he once did like a hypnotist on a stage.  I once wrote that the saddest thing to witness is an unfunny comedian doing his act.  No, that's now #2.  Leading the pack is a former Fed Chairman who still doesn't get it.

I watched his testimony yesterday and I really felt sorry for the guy.  I'm sure he's a nice man who likes dogs and buys his wife, NBC correspondent Andrea Mitchell, pretty flowers on her birthday.  But as an economist or a Fed chairman he's just clueless.  A taxi cab driver from the streets of Dayton, Ohio pulled out of his hack at random would have done a better job at the Fed.  And that's no slight against taxi cab drivers either.

Want to see how bad the ridicule has finally gotten?  Check out this video clip of Greenspan being compared to "Godfather" Don Corleone by talk show host Dylan Ratigan.  Yes, it's hyperbole but he's not far off the mark.

On a more serious note, check out GREENSPAN'S BUBBLES: THE AGE OF IGNORANCE AT THE FEDERAL RESERVE the wonderful book by author William Fleckstein that makes it very clear Alan needs to rethink his legacy, and do it REALLY REALLY fast.

Robert J. Abalos, Esq.