Monday, September 17, 2007

Greenspan Kiss &Tell: The [Unpublished] Excerpts

In her latest attempt to out-scoop Macro-Man, Cassandra - using a small army of veiled Iranian women in combination pioneering German software that, to date has been employed piecing together shredded STASI files - managed to resurrect excerpts from the nuked chapters of Greenspan's memoirs. Who would've guessed that under his thick exterior, and cryptic lingo was prescience and senstivity on a previously unknown range of social and scientific issues!

Greenspan on the Invasion of Iraq: I have typically kept out of the political fray, at least that outside of my day to day concerns as head of the America's Central Bank. And while I will admit to being seduced by Richard Perle's Powerpoint presentation on how the invasion would create a libertarian domino effect in the entire region, I certainly had my reservations, which I voiced privately on several occasions. The first time was to my driver, back in Dec 2002, when I told him "...on balance, not upsetting the status quo might be in the greater long-run interest, if upsetting the balance is not deftly managed...". The second occasion was at home early in Jan 2003, when I whispered to my cat, MilkyGalt, that some of the intelligence that the Administration was using to justify the threat was "hanging in the balance". Of course this categorical opposition vindicated, and had I known how bad things have turned out, I would have voiced my concerns even louder.

Greenspan on Chinese Product Recalls: It has been concerning to me ever since the Chinese-made lights on my Christmaskuh Bush shorted-out and nearly burnt my house down, that the quality of Chinese products would evolve into serious issues for consumers. In fact, I wrote a letter to the manufacturer (cc:ing Walmart for the record) that "...grave consequences could result for US-China trade if crucial issues pertaining to the sustainable mutual exchange of goods and services
were not addressed...". I also asked for a refund of the $2.49 for the damaged string of lights (which I duly received). Of course I would have spoken out much louder, and used my position of influence had I known that heinous lead, and counterfeit ingredients would threaten the lives of millions, my small error in judgement being not the recognition of the problem, but underestimating the nefarious nature of the villains.

Greenspan on September 11th: I have long been a champion of freedom and liberty, and make no apologies for casualties in its pursuit, be it the Soviet Union or the average laborer of the world. I had long-held suspicions that the first attempt by radicals to bring down the towers would be followed by another, more serious attempt. So convinced was I of this that I wrote a very long entry in my personal diary to the effect "...necessary US retaliations to the USS Cole Bombing I fear will lead to a tit-for-tat struggle that will challenge the balance of policy, possibly yielding another retaliation perhaps again upon the symbolic economic infrastructure of our nation..." Of course, my role as Chairman of the FRB precluded making any public pronouncements, though rest assured I mentioned this in private to some influential people who I won't name so they won't be embarrassed by their inaction.

Greenspan on Drug-Coated Stents: Ever since my doctor told me that if I didn't improve my diet, I'd be wearing stents, I've researched their evolution quite closely. I appreciated early-on the cost vs. benefit of stents, but I was certainly suspicious when drug-coated ones were adopted so quickly, much floating-rate mortgages were adopted by would-be housebuyers and those looking for an extra kick in their refinancing. Like variable-rate mortgages, I initially endorsed the drug-coated stents, issuing the following caveat "...I see no reason to fear the insertion of drug-coated stents versus original-recipe, provided the recipient has reasonable expectations about the actual benefits such stents will provide..." This, of course was similar to my unequivocal warning to those borrowers taking out variable-rate mortgages, which for the record, was NOT my fault that said borrowers were buggered due to subsequent rises in interest rates.

Greenspan On The Virtues of Vitamin 'C': Iconoclasts like Linus Pauling and Ayn Rand have always attracted me, intellectually. But that doesn't mean I espouse every crackpot idea that such luminaries champion. Take Vitamin-C. I told my family, privately, that Pauling's recommendation to consume grams of vitamin C each day was likely to prove ineffective as a polciy for better health. Too much of a good thing, like taxes, or asset price rises (like I always said privately) are inimical to long-run stability and growth. I admit however that I never told Dr Pauling directly that I thought he was a crackpot for such notions. I did however, warn Senator Bunning at a Humphrey-Hawkins hearing, when I saw him gobbling up a plateful of ascorbic acid tablets that pursuing such a single-mind course of action was unwise, would keep him awake at night, and if nothing else, he should be drinking some fresh-squeezed OJ with them to make them more effective.

Greenspan on Crumbling Infrastructure: I frequently wrote in my diary, and warned anyone who asked (though careful not to do so in public and so unwarily influence public policy beyond my restricted brief, that failure to invest and inspect our public infrastructure would result in catastrophic consequences, and that one day, we might see bridges collapse directly from under the wheels of cars. I thought, philosophically, that the best approach would be for the private sector to handle it, and so I always lobbied (privately of course) for the market solution of pay-by-use, where the proceeds would be used to direct effect upon infrastructure endangered by neglect or poor government-inspired engineering. So while I did not directly predict the bridge collapse in Minnesota, I certainly foresaw the less-desirable outcomes that could result from inferior ideologies.

Greenspan on the Space Shuttle Challenger: I have always been suspicious of government intervention in space, our ability to recognize and react to space-bubbles, and so it was apparent to me that NASA was on a collision course with disaster. So concerned was I that our efforts were not only in vain, but contributing to potential disaster, I directed, on several occasions, FRB researchers to attempt to establish the link between Government Intervention and space, and lower space productivity. Naturally these results were kept internally, in order to unnecessarily roil markets, but the results were clear: space-bubbles are virtually impossible to detect and even more difficult to pop.

Greenspan on the Hurricane Katrina: My critics have falsely accused me of suggesting that residents of New Orleans "got what they deserved", using this out-of-context remark to indict my preference for laissez-faire and market-based outcomes. Nothing could be further from ten truth, and this was very very hurtful to me, being so intentionally mis-quoted, on something as tragic as the worst natural disaster America has ever seen, when what I actually said was: "They deserved what they got [for living below sea-level in a floodplain].

Greenspan on The Unabomber: As I public figure, I've learned to live with critics and detractors, since it's impossible to be a public figure with bold ideas and a contentious ideology without upsetting more sensitive segments of the population - especially the weak-minded altruists. But I reject accusations that anti-government crackpots and perpatrators of heinous crimes against the people like the Unabomber or Timothy McVeigh were in any way influenced from the same philosophical milk-teat as myself or Milton Friedman. This is nothing but character assassination, and while I'll admit that I restrained the Fed from intervention and supervision for which it was notionally charged, it was only because I believed that the cure was worse than the illness, which is exemplified by the lingering effects the FRBs own experiment with near-zero interest rates. But it is just mean and nasty and place me in the same sentence of McVeigh and Kuczynski, irrespective of how many times they claimed to have read "Atlas Shrugged"


Macro Man said...

I can see this book keeping us in comments for years....

Anonymous said...

F*&%ing Greenspan, f*$#ing Ayn Rand water bucket boy, f*$#ing up the world in the name of John f*&@ing Galt.


ps had to release my feelings about the sonof*#(@% after having seen his face on tv last night.

"Cassandra" said...

MM - THe only thing I dislike more than authorized biographies are revisionist memoirs. Makes me think of the trade by shrinks and gurus in "manufactured memories". On the other hand the kiss & tell stories revealed by close advisors now no longer as close (e.g. Duncan Campbell's) have the potential to be far more amusing.

PI - I hear your agony and sympathize.

Anonymous said...

Greenspan would have looked much better at RFK if he had put a jockstrap on his head instead of a Nationals China imported ball cap!

Anonymous said...

I'll wager Pearle's breath is worse.