Alan Greenspan: Maestro or mountebank?
Ben Bernanke: "Behind the curve", or left holding the bag.
Our approximate mental map of the Great Depression starts with a picture of a baby modern economy nicely toddling along exploring wondrous possibilities while whistling a Gershwin tune. In Act II, the government economic minders of the day (largely the Fed), who hadn’t yet caught up and developed an understanding of the new forces and didn’t yet have experience in using their new monetary policy toolkits “made a mistake”, and the wobbly toddler took a tragic header into the dustbowl. Act III was the heroic government effort to correct “the mistake” and send us on a permanent path of growth and greatness (not of honest money, but you can’t have everything).
There’s a “not so fast” school of thought-- a monetary policy seeds of our own destruction type counter theory that should be speaking rather loudly today. And to a certain extent it is-- one can go on the internet and see Peter Schiff, Bill Fleckenstein, Martin Weiss, Doug Casey and others explaining big pieces of what’s happening and why.
I wonder though, as I watch Former Fed Chairman Alan Greenspan in a perhaps somewhat understandable but nonetheless revolting and craven attempt to rescue his reputation: What if Greenspan actually succeeds, even in part? What if the (correct) counter theory gets drowned out again? What if, after all the economic pain thus far (and whatever might be yet to come), we crawl into the sunshine in a few years, and from our relief and hope that we’ll never have to go through it again, we label the whole thing “Bernanke’s mistake”. That would be easier-- we wouldn’t have to think about it too much or reform anything-- we could just move on and get back to what we hope is normal. At the Federal Reserve (“the fraudulent legend”, as Murray Rothbard labeled it), things would go on just the same until the next inevitable, embedded, systemic “mistake”.
As pompous as it may sound, and oversimplification aside (for I do want to talk about central banking’s flaws-- any idea that we need any “maestro”, Greenspan or otherwise, is insidiously damaging to our economic future), the above is roughly why I started this site. Pompous and passionate-- that's me-- for as you can also surmise from the above, I consider this an important fight.
It’s either us, or the Maestro’s rep.