Alan Greenspan

Paulson & Co’s Private Greenspan Shrine

Perhaps the height of Wall Street’s Alan Greenspan worship was reached with a 1998 article in The New Republic about a bond traders who actually created a shrine to Greenspan. “Dozens of news photographs of Greenspan adorn the walls; glass casing encloses two Bic pens Greenspan supposedly used in 1993,” the article reported. “Quotations from more than 30 of his speeches are posted under a sign that reads ‘Greenspan’s Teachings.’ The centerpiece is a red leather chair that sits in the middle of the room, surrounded by blue velvet ropes. A placard perched on the armrest says Greenspan sat in the chair in 1948—at the time, he was still in college. ‘Some nights when we’ve lost money,’ trader Brent Donalds confides, ‘I come in here and sit in the chair and think. It gives me inspiration.'”
The problem is that the author of the article was Stephen Glass, and it was completely fabricated. The bond outfit described didn’t exist outside his imagination. There was no red chair surrounded by blue velvet ropes. But Greenspan worship was at such a height at that point that people actually believed the story, or at least found it almost plausible for a while.
These days Greenspan’s reputation is not what it was. But this morning the Financial Times reports that he still is held in high enough esteem by some financial players that he landed a job at Paulson & Co, the $28 billion hedge fund that famously profited by calling the crash of the subprime mortgage market. Paulson & Co will enjoy exclusive access among hedge funds to the advise of Greenspan. He also has advisory deals with Deutsche Bank and Pimco.
We are kind of hoping they do give him a red leather chair from which to issue his advice.
Greenspan joins NY hedge fund [Financial Times]

Castro Hearts The Maestro

Castro Greenspan.jpg
That huge rush of Alan Greenspan publicity last week seems to have penetrated into the last hold-outs of the ruins of the evil empire. Yesterday, pictures surfaced of Fidel Castro sporting a copy of Greenspan’s book, The Age of Turbulence. Perhaps most interestingly, Castro’s copy seems to bear a discount sticker from Barnes & Noble. Amazon could not be reached for comment.
But you know who was reached for comment: fake Jeff Skilling!
“Alan Meatspin needs to learn that it’s better to have no friends than to have Communist friends,” Skilling allegedly writes from insider his jail cell.
Click the picture for a close up of the Barnes & Noble sticker.
Greenspan and Castro, sitting in a tree, agreeing on monetary policy []

Greenspan Bums The Shit Out of Jon Stewart

Alan Greenspan has sometimes been accused of being intentionally inscrutable. While it may have once been a fair charge, a very different Greenspan was on display last night when he appeared on the Daily Show with Jon Stewart.
Some of his explanations were startlingly frank, expansive and plain-spoken. For instance, when he explained what it is the Federal Reserve does he uttered exactly the sort of thing that the tinfoil hat Fed conspiracy theorists think that an establishment type would never say. And when Jon Stewart tried his own version of Fed conspiracy talk, he got bitch slapped.
“It seems to me that we favor investment, but we don’t favor work,” Stewart said. “The vast majority of people work — they pay payroll taxes, and they use banks. And then there’s this whole other world, of hedge funds and short-betting and — it seems like craps. And they keep saying, no no, no, don’t worry about it, it’s free market. That’s why we live in much bigger houses. But it really isn’t. It’s the Fed, or some other thing, no?”
“I think you better re-read my book,” Greenspan said. “What a sound money system does is to stabilize all the elements in it, and reduces the uncertainty that people confront. And the one thing all human beings do when they are confronted with uncertainty is pull back, withdraw, disengage, and that means economic activity, which is really dealing with people, just goes straight down.”
There’s more on the exchange at the Wall Street Journal’s Real Time Economics blog. Or you can just watch the video above. It’s “Safe For Work”…to the extent that watching fake news programs can be considered “Safe for Work” at all.

Greenspan Day: It’s 1996 All Over Again.

alangreenspan.jpgCould the launch of Alan Greenspan’s book be better timed? With so much is on hold today as the markets prepare for this week’s earnings and interest rate news, the release of The Age of Turbulence has basically called down a torrent of attention. It’s like Wall Street and the business press decided to turn up the way back machine and declare it 1996—the year Greenspan shocked the markets by using “irrational exuberance” in a speech to the American Enterprise Institute—all over again.
After the jump, we bring you an exhaustive—and we mean exhaustive—run through of the coverage.

Read more »