The Three Lives Of Alan Greenspan... And Why The Third Won't Redeem The Second

Tyler Durden's picture

Submitted by John Rubino via DollarCollapse.com,

When the history of these times is written, former Fed Chair Alan Greenspan will be one of the major villains, but also one of the greatest mysteries. This is so because he has, in effect, been three different people.

He began public life brilliantly, as a libertarian thinker who said some compelling and accurate things about gold and its role in the world. An example from 1966:

An almost hysterical antagonism toward the gold standard is one issue which unites statists of all persuasions. They seem to sense – perhaps more clearly and subtly than many consistent defenders of laissez-faire – that gold and economic freedom are inseparable, that the gold standard is an instrument of laissez-faire and that each implies and requires the other…

 

…In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value. If there were, the government would have to make its holding illegal, as was done in the case of gold [in 1934 under FDR]. If everyone decided, for example, to convert all his bank deposits to silver or copper or any other good, and thereafter declined to accept checks as payment for goods, bank deposits would lose their purchasing power and government-created bank credit would be worthless as a claim on goods. The financial policy of the welfare state requires that there be no way for the owners of wealth to protect themselves.

 

This is the shabby secret of the welfare statists’ tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists’ antagonism toward the gold standard.

Awesome, right? But when put in charge of the Federal Reserve in the late 1980s, instead of applying the above wisdom — by for instance limiting the bank’s interference in the private sector and letting market forces determine winners and losers — he did a full 180, intervening in every crisis, creating new currency with abandon, and generally behaving like his old ideological enemies, the Keynesians. Not surprisingly, debt soared during his long tenure.

Along the way he was instrumental in preventing regulation of credit default swaps and other derivatives that nearly blew up the system in 2008. His view of those instruments:

The reason that growth has continued despite adversity, or perhaps because of it, is that these new financial instruments are an increasingly important vehicle for unbundling risks. These instruments enhance the ability to differentiate risk and allocate it to those investors most able and willing to take it. This unbundling improves the ability of the market to engender a set of product and asset prices far more calibrated to the value preferences of consumers than was possible before derivative markets were developed. The product and asset price signals enable entrepreneurs to finely allocate real capital facilities to produce those goods and services most valued by consumers, a process that has undoubtedly improved national productivity growth and standards of living.

He cut interest rates to near-zero in the early 2000s, igniting the housing bubble – which he was unable to detect along the way. He even made it into the dictionary, as the “Greenspan put” became the term for government bailing out its Wall Street benefactors.

From this the leveraged speculating community learned that no risk was too egregious and no profit too large, because government – that is, the Fed – had eliminated all the worst-case scenarios. Put another way, under Greenspan profit was privatized but loss was socialized.

Greenspan retired from the Fed in 2006 and, miraculously, began morphing back into his old libertarian self. A cynic might detect a desire to avoid the consequences of his past actions, while a neurologist might suspect senility. But either way the transformation is breathtaking. Consider this from yesterday:

Gold Standard Needed Now More Than Ever? – Alan Greenspan Comments

(Kitco News) – It would be best not to be short-sighted when it comes to gold; at least that is what one former Fed chair says.

“[T]he risk of inflation is beginning to rise…Significant increases in inflation will ultimately increase the price of gold,” noted Alan Greenspan, Federal Reserve chairman from 1987 to 2006, in an interview published in the World Gold Council’s Gold Investor February issue.

 

“Investment in gold now is insurance. It’s not for short-term gain, but for long-term protection.”

 

However, it is really the idea of returning to a gold standard that Greenspan focused on — a gold standard that he said would help mitigate risks of an “unstable fiscal system” like the one we have today.

 

“Today, going back on to the gold standard would be perceived as an act of desperation. But if the gold standard were in place today, we would not have reached the situation in which we now find ourselves,” he said.

 

“We would never have reached this position of extreme indebtedness were we on the gold standard, because the gold standard is a way of ensuring that fiscal policy never gets out of line.”

 

To Greenspan, the reason why the gold standard hasn’t worked in the past actually has nothing to do with the metal itself.

 

“[T]here is a widespread view that the 19th Century gold standard didn’t work. I think that’s like wearing the wrong size shoes and saying the shoes are uncomfortable!” he said. “It wasn’t the gold standard that failed; it was politics.”

One of the nice things about the information age is that public figures leave long paper trails and can’t therefore easily escape their pasts. Greenspan’s past, being perhaps the best documented of any central banker in history, will haunt him forever.

But hey, at least he’s going out a gold bug.

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Giant Meteor's picture

Well shit again ..

Greenspan ...

The end is nigh ..

Croesus's picture

Hopefully, his 4th life will be as a wind chime.

Omni Consumer Product's picture

Hopefully, his 4th life will be as a toilet plunger.

Creative_Destruct's picture

The damage this ass-kissing social climbing money-pumping despicable POS has done is irreversible and can't be made up in a thousand lifetimes.

MarketAnarchist's picture

Bix weir:  ROADtoROOTA.com

 

Greenspan is a GOOD guy

greenskeeper carl's picture

Funny how he goes to saying all the correct things, then he gets in power, and does more damage than even we on here probably realize, then he gets out, and starts saying things that makes sense again. Hmmm.

HillaryOdor's picture

To be fair, Greenspan has no obligation to state the truth to the American people when acting as an organ of the American politburo.  Any population stupid enough to accept the imposition of a central bank issuing toilet paper fiat, and the rule of a government of satanic pedophiles which defers to the banking psychopaths and criminalizes average Joes for (e.g.) growing unapproved plants, frankly they deserve to have their wealth confiscated and their lives destroyed.  The smart people are still making out like bandits though.  But all the little morons are crying for socialism.  And you want someone to tell them the truth?  LMFAO.  I'm sorry.  It's far too late for that.  Game over man.  Humanity lost.  It has not demonstrated enough value to be treated with respect.  That's how they see it at least and it's already very hard to argue with that.

I'm just sayin', if I were in Greenspan's shoes and I could make a killing fucking over the American people who were stupid enough to give me the power to do so, and too stupid twice over to even know I was fucking them, then why shouldn't I?  Don't come crying with moral arguments either.  If it isn't me it'll just be someone else.  No one should have that power in the first place, and the people should know that, but it is the American people that really sold their soul.  The politicians are just the salesmen.  

bonin006's picture

I remember when Greenspan made his comment about irrational exuberance, and how the stock market took a dive because of it, and how congress hauled him and chewed him a new asshole. At the time I was still one of the sheeple, and thought he was an asshole for making my stocks go down. It wasn't until years later that I started to figure things out.

I think that incident with congress was the final fuck it moment where Greenspan gave up any idea about doing the right thing, and decided to just give them what they want. There are very few people in world willing to go through the sacrifice of doing the right thing when it means being attacked and vilified, when they can just go with the flow and end up with a nice salary and pension.

Assange and Snowden are a couple that come to mind. How many of us are willing to go through what they have?

Theosebes Goodfellow's picture

Before anyone gets all bitchy on Alan Greenspan, show some empathy. The poor bastard's married to Andrea Mitchell after all. /s

illuminatus's picture

So Hillary, you are then in the camp that it is all right to fuck someone over if you get the chance? Morality means nothing?  Got it. And yes, that was me downvoting you.

HillaryOdor's picture

In your personal life morality means everything.  With government, all bets are off.  History hath shewn, power attracts psychopaths and if you don't do what they want they'll just find someone who will.  You can try to fight the good fight but like the guy above you said they will just crucify you in the media and the people will come to hate you.  We shouldn't have this behemoth in the first place but Americans sold their soul to the devil.  I have no sympathy for them.  This is what you get when you place your faith in government, every... single... time.  It's sad but people have to learn their lessons eventually or they'll just keep making the same mistakes.  It's gonna take a long time though, not in my lifetime.  They're still too dumb to learn.  Watch after the next crisis socialism will be all the rage, even more than today and we'll get a new psycho preaching the Bernie Sanders nonsense.  So why should I exercise morality when dealing with a bunch of socialists?  They're scum and they want my things.  I wish they'd disappear.

ThirteenthFloor's picture

So when questioned in Congress as Greenspan you would lie? You would make speeches "stating that buying mortgages was not a good idea" , while your boys were in fact buying mortgages. One thing to want to make money another to lie to people to do it. That is a Con Man, I think of no better description of Greenspan.

Not everyone was conned. Dr Ron Paul did give him back his book.

HillaryOdor's picture

Is it wrong to con scumbags?  Would you feel bad conning Pol Pot?  I didn't ask for all this government and I don't want it.  I'm sick of it.  The rest of the people of this country imposed it on me.  The sooner it destroys itself the better.

Jimmy Jimmereeno's picture

It is always good to give credit where is due.  However, let's try to not give more credit than is due.  In Rubino's reference to the 1966 "gold" essay in "Capitalism: The Unknown Ideal", I have raised the point elsewhere that the essay strikes me as something that Rand ghostwrote then assigned Greenspan's signature.

BeanusCountus's picture

Can't help it, but remember his recommendation for everyone to take out adjustable mortgages (in 06?) and leverage up. Makes me sick to this day even though I didnt participate. Hard to believe he is given press as an expert. A little nervous to invest more in gold right now simply because he is suddenly a fan (again). Only thing I can say is: listen to yourself on gold. Might be right, might be wrong. But the "experts" don't know any more than you do. Personal belief is that putting a few bucks in gold on a regular basis is just the same as "averaging in" to the S&P.

max2205's picture

I can say for sure I will not be going to his funeral.  

WakeUpPeeeeeople's picture

Wouldn't mind the opportunity to piss on his grave

greenskeeper carl's picture

I was thinking I'd like to see him doing clan up duty after peepshows, but plunger works too.

Normalcy Bias's picture

Libertarian to Sellout... they HAD shit on this guy...

ZH Snob's picture

bix weir claims he is the greatest double agent for his original love, gold--ever.

if your complaint about him is his initiation of the destruction of fiat currency, I say mission accomplished, sir.  when you think about it, he could have just muddled along, taking good care of the phony dollar, but instead he went full retard to fufill its eventual destruction.  that is why he has returned to praise gold.  he knows he started the fire that can never be extinguished and that gold's return is near, only bigger and better than ever.

holdbuysell's picture

If there were a Nobel Chameleon Prize, he'd get it. The changes in stance he made over his life are breathtaking.

Jimmy Jimmereeno's picture

Yes.  There's no way that one can make "breathtaking" changes in character throughout life without having a completely facile psyche; the psychological makeup that has no firm grounding in a philosophical outlook.  Greenspan is an individual of the type that, as I posted earlier about his "gold" essay, would be completely at ease to assume the false attribution of an essay that Rand  had ghostwritten.

 

Dabooda's picture

You may be right about Greenspan's character -- but NO WAY Ayn Rand would refrain from taking credit for something she had written.  Not. Possible.

I Write Code's picture

If he had any sense he'd stick to playing bridge and never give a public statement again.

MuffDiver69's picture

Another reminder ISIS has a purpose.

opport.knocks's picture

It's not that hard to figure out, Greenspan is talking the position that makes his tribe the wealthiest. We can't go back to a gold standard until the J-mafia controls the market. Aren't they the ones who currently keep manipulating it lower?

Ms No's picture

So, did he find his "precious" finally? 

 

cn13's picture

I can't wait for Greenspan to die so I can go piss on his grave.  

I might even drop a deuce if the opportunity arises.

Father ¢hristmas's picture

You'll have to settle for going in a mausoleum.

Although that might prove to be even moar opportune if no one sees you go in.

blindman's picture

CROSBY, STILLS & NASH /// 9. Long Time Gone - (Crosby, Stills & Nash) - (1969)
https://www.youtube.com/watch?v=2DUqplxIcNk

Robert Trip's picture

The Fuhrer dealt with the bankers swiftly and effectively.

The German people rose from a nation of servitude and no hope to a power on the international scene.

History can teach us valuable lessons.

Not your American history written and published by YOU KNOW WHO.

DirtySanchez's picture

The most horrible jew of the past 30 years.

Absolutely reckless policies.

Architect of the haves and have nots in the USA.

The jew will soon burn in hell for all eternity.

WillyGroper's picture

3 different people...DID is what happens when you get plowed at an early age.

mtanimal's picture

He was always a sell-out and an opportunist. Ayn Rand was just a stepping stone along his crooked path.

onwisconsinbadger's picture

What keeps this guy alive ? Government paid health care.

Robert Trip's picture

Kissinger, Albright, Soros, this guy and that ancient bag on the Supreme Court.

How do you explain their longevity?

These people are always in your face.

What a drag.

T-NUTZ's picture

They drink the blood of infants.

Hongcha's picture

Add to that Warren Buffet.  Sick of that twisted old schmecker.

GreatUncle's picture

One of the biggest globalists out there and got all your worth.

blindman's picture

Big Joe Turner - Flip,Flop And Fly - 1966
https://www.youtube.com/watch?v=tLP6PScAYVk
.
here ya go.

besnook's picture

if you bothered to listen closely to greenspan during his tenure at the fed he continuously warned about the issues of fiat and how those issues would come home to roost. they have now. he was right.

Sledge-hammer's picture
Sledge-hammer (not verified) Feb 19, 2017 10:48 PM

Yes, it was a brilliant move to create the Federal Reserve, let jews control it, allow inflation to destroy 98% of our dollar's value, take us off of the gold standard, control our monetary policy, and f*ck up our economy for generations.  Never allow a jew to get in your pocket.  Christ, when will we be free of these vermin?

Father ¢hristmas's picture

"When the history of these times is written, former Fed Chair Alan Greenspan will be one of the major villains, but also one of the greatest mysteries. This is so because he has, in effect, been three different people."

He's been able to be three different people because the public has gotten three times dumber than they were when he first came on the scene.

And history won't say jack shit about Alan or Ben or Janet or any other munneychangers because they will have chipped everyone by then.

They've already got children confused on their gender.  You really think epsilon semi-morons are gonna be discussing the history of monetary policy as they wait for Mustafa Mond to authorize the chip in their foreheads to release a dose of Soma?

Shit, most of the guys discussing monetary policy now are only doing it to front-run plebes and goyim.

No More Bubbles's picture

How is this piece of shit still alive?  FUCK THIS SCUMBAG!!!!

ReignDeer's picture

Because he has no obligation to american nation. Read Culture of Critique by Kevin McDonald. It is really insightful when it comes to jewish 'soul'.

francis scott falseflag's picture

It's kinda incumbent on me to mention this briefly now that everybody is familiar with "Da Deep State."

There is plenty of circumstantial evidence that Greenspan was tasked to crash the global economy.

He did so by allowing the big banks to create and sell subprime mortgage bonds. Clinton obliged by

not vetoing  the Glass Steagall repeal, which was thought by some to be the prime reson the gobal

economy has been in a recession since 2008.

 

Why did Greenspan undertake such a project?  Why did the deep state want it done?

It's the crude oil, stoopid

 

The same government flunkies who release all the phony info we gobble up, have been lying to us

for years about how much oil is still in the ground.  There's no where near enough for a booming

global economy and a tumescent Pentagon.  So Greenspan spawned a world wide recession to

stifle demand for gasoline and crude oil.  

 

The deep state has another 20, 25 years before it confiscates all the earth's oil.

But it must eliminate other nations that will object to such a move.