The FED conspiricy mongers miss the point. Even with guys like Greenspan pushing the supply side snake oil, the growing US financial system has overwhelmed and run ahead of the central banking system which is just trying to keep pace and do damage control of a financialization trend way out of control. Evidence is there for all to see. The FED cannot control hedge funds, for example, most of which are unregistered and exempt from SEC oversight and manage upwards of $1.5 trillion in funds. Some pensions are 20% to 40% invested in high risk hedge funds.

Trillions of dollars swamp the system with speculative liquidity and innovative financial instruments. The FED does less and less to control and regulate the US economy. It just follows along controlling damage. We have reached the Lassez Faire sytem often thought impossible. There is less and less oversight. And it is increasingly dangerous.

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]

The Fed is also probably an illegal racket. It just the latest incarnation of the beast killed off earlier in US History.

I'll spare you the long set of details, but will assure you this:
The more you find out about our monetary system the more disenchanted you will be. This is no way for a democracy to run it's central bank.

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]

This man has done so much damage over the years, I don't know where to start.

The fact that Nixon made him chief of his Council of Economic Advisors (then secretary of...Treasury? I forget) should be all most of us need to know.

During the Clinton administration, every time somebody got a job, he raised rates. He spent Clinton's last year raising continuously - trying to throw the economy into recession for Bush - then after the election, opened the floodgates. Reid had it exactly right.

BTW, it is almost unprecedented to raise rates in an election year. And I HEARD him encourage mortgage lenders to engage in "creative financing". He is a lying SOS.

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]

I find it interesting that Reid calls Greenspan a political hack.. (guess it's just Reid being a politician - with many skeletons to hide). Reid would have been better off calling Greenspan a gambler with one of the greatest economies.. ours!!!

While most would be hard put to argue details and specifics with him, the ordinary person just needs to look around to see the struggling middleclass and small business owners..the backbone of this country.

Over the years the insane rate adjustments causing market declines etc.etc..just never made much sense. While we probably cannot blame the outsourcing of America on him I would suspect he could/should have had some foresight on these issues to have an impact..

While is role is that of monetary policy, we do not seem to be in such great shape lately. Some herald him as the "all knowing"... I think he was just a guy rolling the dice!

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]

I am no economist, nor do I play one on TV, but I do know a bit about Ayn Rand's philosophy, to which both Friedman and Greenspan were adherents. If there is anything flawed, maybe even frightening about the economist is that they believed in Ayn Rand's philosophy of self-serving, "don't mess with me and I won't mess with you " philosophy. I could also throw in Republican candidate Ron Paul.

What is most frightening is their "free market" economic ideology. Greenspan's economics "worked" (in a bad way) like a charm under Clinton, because Clinton followed Greenspan's advice like a god. Under Bush II, the Fed Chair found neo-con ideology much more powerful and manipulative than he expected, Greenspan ended up doing damage control, rather than Fed predictions and regulating.

While my commentary explains the differences between Greenspan under two presidents, it doesn't explain the great divide between the rich and everyone else or how flawed free market economics are.

I think either Rand adherents underestimate the power of the wealthy to manipulate every economic, political and social aspect of our lives to their favor, or economists like Greenspan, Friedman, etc. all believe the rich to be benevolent merchants of jobs who'll do the right thing because markets are self-correcting.

Greenspan et. al. refuse to believe that the economic table is tilted in favor of the rich. They politely ignore imperialism, war, death, destruction, except how it effects the market. Meanwhile, they expect charity to make up the enormous differences in disproportionate wealth distribution.

The wealthy nihilists don't give a damn about the poor, except maybe that they might wake up and revolt! But, they won't lose any sleep as long as they've got Republican and Democratic leaders imposing education "reforms" like No Child Left Behind that dumbs down public education, puts dissenting teachers in check and ensures the next generation to be dumber than our president. The rich and powerful are assured to maintain their power for at least the next generation; but there's always hope that Ayn Rand is rotting in her grave and the smell creeps out and makes us want to bury her deeper in the earth.

Peace

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]

Our LAZY FAIR system does a hell of a job to boost corporate welfare come as it is. With the way the Federal Reserve happily feeds and defends the corporate welfare queens, one would normally expect the Libertarians to be outraged and call for an ABOLITION OF THE FEDERAL RESERVE. Then again, they don't even stand up for civil libertarian policies, a hard lesson I learned when I tried to join the Libertarian Party in my state only to get kicked out when questioning the erosion of our civil liberties and the rise of WARfare.

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]

I heard Alan Greenspan on All Things Considered yesterday afternoon crying the big crocodile tears about income inequity. Of course, he took no responsibility for his policies which led to the widening gap between the megarich and everybody else in this country.

As an antidote to Greenspan's selfserving memoir, might I suggest Greenspan's Fraud by noted economist and academician Ravi Batra.

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]

ADMEN! and AMEN some more. This article tells it like it is.
Greenspan supports the financial interests and ignores the rest of us. He is also an egomaniac.

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]

It is so good to finally see this guy knocked off of the pedestal. This guy never cared a twat about the average working person and was totally a gnome of the plutocracy that now controls virtually everything in this country.

It has been disgusting how the press over the years fawned on this guy whenever I turned on the nightly news or read a newspaper. He did nothing but accelerate the trend of reducing living standards and hollowing-out the middle class.

Greenspan and others of his ilk have absolutely no clue about the lives of ordinary people struggling economically. As far as he is concerned, they might as well be martians.

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]

Why is anyone surprised, Greenspan did exactly what he was suppose to do, protect the Wealthy, and Corporations, at the expense of anyone else. This is the basis for Republican philosophy. We elected this scum, therefore we deserve what we get.

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]

My guess is that the current fed board sees the handwriting on the walls and wants some excuse to keep it Greenspan's recession. This way Bernake can say, Don't blame us; we showed big time that we love cheap money.

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]

It just prints money and shovels it out to the financial/ investment community, covering their asses so they can continue to pay dividends to their wealthy clients, rolling the printing presses to elect Republicans (like the August 1982 turn around - all of the sudden the Fed wasn't "monetarist" anymore, now that it had done in Jimmy Carter with high interest rates, and there was a mid-term election coming up with lots of Repubs at risk), and any help to low and middle income people is called a 'fiscal" issue and dealt with on the public expenditure side of the financial system, and of course, called a giveaway...like the discount window and "open-market operations" aren't hundreds of billion of dollars of giveaways hidden from the U.S. public, giveaways that debase the currency and have as Grieder points out created huge dislocations in the U.S. economy that will take generations of combined fiscal, regulatory, trade, and monetary policy to fix. Like our government can do anything that coherent.
No, the Fed should be limited to regulating the commercial bank reserve ratio, and other wise purchasing U.S treasury securities and the securities of other public bodies, state and local government, school districts, etc. No discount window, no "open-market operations." And the U.S government should limit itself to assuring the integrity of the deposit insurance systems, only up to the amounts prescribed by law.
Cut the rich investors loose. Make them stand on their own feet. No more handouts to the rich. And many, many more Americans are becoming aware of what a racket and shell game the Fed has truly been. Legally-speaking Greenspan's and others like him; their heads should roll.

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]

Back in 1790, Alexander Hamilton pushed for a central bank 80% owned by private investors and he got it in 1791. The newly formed United States wrestled with this for 20 years and then, in 1811, Congress refused to renew the charter of the Bank of the United States which was a private entity one fourth of which was owned by European bankers as there was no requirement of citizenship for ownership, the rest being controlled by as little as 100 individuals. The response to the denial of the renewal of the charter from Europe was as told by Nathan Mayer Rothschild, "Either the application for renewal of the Charter is granted, or the United States will find itself in a most disastrous war." This resulted in the War of 1812. Nathan Mayer Rothschild further threatened, "Teach these impudent Americans a lesson. Bring them back to Colonial status." At this same time Thomas Jefferson observed, "If the American people ever allow private banks to control the issuance of their currency, first by inflation, and then by deflation, the banks and the corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their father's conquered ... I believe that banking institutions are more dangerous to our liberties than standing armies ... The issuing power should be taken from the banks and restored to the Government, to whom it properly belongs."

Unfortunately, Congress capitulated and in 1816 the Second Bank of the United States was chartered for another twenty years. It should be noted that by this time, the United States government lost its 20% share in the Bank of the United States so that it was now completely privately owned. This created the notion of a business (bank) as an artificial person entitled to the same rights under the Constitution as a real person, thereby justifying the creation of a private bank as the controller of the banking and credit of the United States as though it was under citizen control.

In 1815, Nathan Mayer Rothschild gained control of the Bank of England, the design of which Hamilton used in creating the First Bank of the United States. Then in 1936, during Andrew Jackson’s tenure the charter came up for renewal again which he vetoed. It should be noted that there were two attempts on Jackson’s life. The Second Bank of the United States now no longer receiving U.S. tax money called in all its loans and went bankrupt in 1941. From this point until the Civil War, the state banks managed the currency of the United States. In 1862, Abraham Lincoln in an attempt to stop European Bankers renewed attempt to gain control of the currency and credit of the United States elected to print the Green Backs. The London Times said of Lincoln at the time, "If that mischievous financial policy which had its origin in the North America Republic during the late war in that country, should become indurated down to a fixture, then that Government will furnish its own money without cost. It will pay off its debts and be without debt. It will become prosperous beyond precedent in the history of the civilized governments of the world. The brains and wealth of all countries will go to North America. That government must be destroyed or it will destroy every monarchy on the globe." Bismarck of Germany said of Lincoln, "He obtained from Congress the right to borrow from the people by selling to it the 'bonds' of States ... and the Government and the nation escaped the plots of the foreign financiers. They understood at once, that the United States would escape their grip. The death of Lincoln was resolved upon."

However, the beginning of the end of Lincoln's bid to thwart the efforts of the International bankers was initiated in 1863 with the passage of the National Banking Act. This was the forerunner to the Federal Reserve Act and the permanent end to American control of its own currency.

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]

Greenspan is a product of typical Republican right-wing idealogy that believes by making the rich richer, everyone will somehow benefit. Just your plain old Regan trickle-down. Now, people cricitize the Fed, but it does have a role to play. Mostly, it needs to have the upper hand via regulatory authority over the many private hedge funds and private equity. That's because they often and purposefully manipulate public equity, the stock market. That helps private equity make money as they blow out equities, sell them short, and buy them back. But it is the hugh amounts of pension plans and savings that many average American's have in the markets that suffer as a result. First of all, the Fed needs to prohibit most all kinds of "private equity," and dark pools of liquidity. Everything should be on the table. As for interest rates and such, that's a shell game we all know about as well. But, the real danger and the real problem is in the unregulated private markets.

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]

Funny thing is he used to be against a central bank! What is truly sad is that history is going to remember this guy as " one of the good ones". US history anyway. But if we get many more of these "good guys", we will BE history. It is sad that so many people seem so hellbent on destroying this country. One must be blind to look at how Bush and Greenspan both have totally paid off the top 3%, and not see a problem with it. The top 3% can retreat to their pacific and caribbean isle homes after they clean off the carcass of america. I just cant believe so many people buy the bull and actually go along with it, thinking they're gonna get a piece. Limbaugh is still rattling away... paris hilton's dog gets more coverage than depleted uranium... hell I don't even know if she has a dog, but either way it still gets more coverage!

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]

This clearly holds true for Bernanke or anyone else who pretends to chair the “Fed” Corp that was never anything but a fraud built to protect corporate crime and corporate gangsters.

A privately rigged bank monopoly in charge of any nation is recipe for serial war along with boom-bust economic tragedy – not to mention fraud. All for the benefit of what Einstein called the “ruling class”.

No accident the true history of the “Federal Reserve” Corporation is never taught at any institution of higher “learning”.

btw, like our corporate owned media and “education” system, William Greider won’t touch any of this truth. Greiders basic work on the “Fed” is a whitewashed doorstop called “Secrets of the Temple” that offers no secrets but more propaganda that lets the “Fed” completely off the hook by perpetuating the myth the "Federal Reserve Corporation" is a public org.

edgar_michel on this thread has outlined the basics on this sham and pandemic so I won’t bother. However, I will quote Andrew Jackson the last president who successfully defeated a corporate crime Mafia through its prime tool (a privately owned “central bank” then called the “U.S. Bank”). What Jackson said of the “U.S. Bank” of his time is equally true of the “Federal Reserve” Corp – the global private bank foisted on the U.S in 1913.


“No nation but the freemen of the United States could have come out victorious from such a contest [European monopolists vs. American people]; yet, if you had not conquered [the so-called central “U.S. Bank” owned by European monopoly bankers], the Government would have passed from the hands of the many to the hands of the few, and this organized money power from its secret conclave would have dictated the choice of your highest officers and compelled you to make peace or war, as best suited their own wishes. The forms of your Government might for a time have remained, but its living spirit would have departed from it.”

President Andrew Jackson - Farewell address to the nation, March 4, 1837

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]

Rockefeller didn't like the trust-busting movement, and so he dreamed up a strategy for legitimizing monopolistic control of economies by trusts.

In the academic arena, he founded the Unversity of Chicago and made sure that someone like Milton Friedman would be the cheif spokesman. He also pushed hard to create the "Nobel Prize in Economics", which is a complete farce, having been launched by the Bank of Sweden in 1969.

Here is an article on that: Nobel descendant slams Economics prize Published: 28th September 2005 12:24 CET

Nobel despised people who cared more about profits than society's well-being, Peter says, reiterating his vehement criticism of the Nobel Economics Prize which he says Alfred Nobel would never have created.

Unlike the Nobel Prizes for Medicine, Chemistry, Physics, Literature and Peace, which were created by Nobel in his 1896 will and first awarded in 1901, the Economics Prize was conceived by Sweden's central bank in 1968 to mark its tricentenary and first awarded a year later.

"There is nothing to indicate that he would have wanted such a prize."

The Economics Prize has over the years been criticized as not being a "real" Nobel, and a newspaper article Peter Nobel wrote in 2001 refuelled the debate.

"It's most often awarded to stock market speculators", which does not reflect Alfred Nobel's spirit of improving the human condition, he fumes.

The other thing Rockefeller did was to promote the Hearst publishing empire, which shared his views on trusts. He also promoted writers like Aryn Rand.

This theme has continued right up to the present day. It's not about economics, it's about psychology and mass control and making sure the people don't oppose the will of the ruling class.

For an example of this, see "Why the draft was ended by Nixon" it's a Libertarian site (read: Corporate Libertarian site), but is eye-opening.

Essentially, they got rid of the draft because they felt an all-volunteer army could be more easily controlled, and wouldn't be as likely to resist imperialist wars. Milton Freidman and Alan Greenspan were on the committee that proposed this.

Again, this all has little to do with economics, and everything to do with psychological manipulation of the public.

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]

THE CUCKOO'S EGG IN THE NOBEL PRIZE NEST
Hazel Henderson

OCTOBER 2006 (IPS) - Peter Nobel, grandson of Nobel Prize founder Alfred Nobel, is part of an academic movement critical of the economics prize as illegitimate, writes Hazel Henderson, whose new book, "Ethical Markets: Growing the Green Economy", covers reform of capitalism and unsustainable, fossilised industrialism. She created the TV series 'Ethical Markets'.

In this article, Henderson writes that this lesser prize was set up in 1969 by the Central Bank of Sweden to help legitimate economics, creating a broad controversy among mathematicians and physicists, who point out that economics is not a science and that many Bank of Sweden prize winners have misused mathematics to 'dress-up' unproven notions or try to 'prove' questionable hypotheses.

Most Bank of Sweden prizes have gone to U.S. 'free-market' economists and followers of the neo-liberal Chicago School. Some of these economists who use or misuse mathematics include those whose models of stock market behaviour led to the collapse of the notorious hedge fund Long Term Capital Management (LTCM) in 1998. This year's winner was US economist Edmund Phelps, who contends that unemployment is necessary to keep workers in line and compliant with their company bosses.

/NOT FOR PUBLICATION IN AUSTRALIA, CANADA, NEW ZEALAND, CZECH REPUBLIC, IRELAND, POLAND, THE UNITED STATES, AND THE UNITED KINGDOM/ (END/2006)

Now, isn't that interesting? Why would that tag be applied? Could it be that economic theory in the West is just a massive PR operation aimed at providing moral support for the billionaire class? Or is that conspiracy theory? Gotta wonder...

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]

Greenspan is 1 of seven board members on a privately owned bank, conveintently called the "Federal" Reserve. He is also only one of two the the presidant can nominate to sit on the board. I don't know about you but seems to me like he is just a troll who is suppose to take all the heat. Forget about Greenspan and focus on what the privatly owned federal reserve did, 1% interest. Wow, they were worried about the house of cards falling. Now they dropped 1/2% in a time of inflation because last month had low inflation. Nevermind the last three years. Of course they only count core inflation so who cares about food and energy. Canada has a national bank called the bank of canada. Why don't we?

good luck, get out of debt, go off grid, buy silver coins and get ready, the house of cards is coming down.

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]

hi mr greider, you're so earnest, and so naive.
the federal reserve is not supposed to work toward the
benefit of the overall economy. its supposed to be used as
a sophisticated smokescreen for "class warfare" ie the rich against
the poor, or the wealth generating class (labor) vs the actionless wealth extraction class (parasites)

all the excruciating details, if anyone dares to read them, are
spelled out a paper I wrote called

"fractional reserve banking as economic parasitism"


endorsed by two phd economists. printed in nexus
magazine, 60k world circulation. #1 top downloaded
economics paper. used by economics
teacher in australia as standard classroom material.

more info on request.
ps, I cite secrets of the temple

recent supporting material:

The Shock Doctrine: Naomi Klein on the Rise of Disaster Capitalism

Confessions of an Economic Hit Man:
How the U.S. Uses Globalization to Cheat Poor Countries Out of Trillions

John Perkins on "The Secret History of the American Empire:
Economic Hit Men, Jackals, and the Truth about Global Corruption"

Video, senator/pres candidate Dennis Kucinich
at last years 2005 Monetary Reform Conference

money as debt video by Grignon

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]

Amusing...

The truth is right in front of you but no one can see.

Capitalism as an economic system proposes continuous expansion.

One would hope that at least the work of the environmentalists, let alone the works of such as Marx, Engels, Lenin, Trotsky, would make it apparent that continuous expansion is in fact impossible, that only a system of expansion based on production for need, rather than profit, is sustainable/possible.

Greenspan's views, weather he believes them or offers them as a fraud, are beside the point as are the views of every proponent of capitalist economics.

Human beings are the only creatures on earth capable of producing far more in a day's work than they need for existence. Capitalism's "A fair day's work for a fair days pay" conceals the fact that capitalist expansion is based on the theft inherent in paying, as a "fair day's pay", only enough for the worker to come back and do it again on the morrow, thus enabling the capitalist to invest the surplus of labor (Surplus to labor's sustenence), in exponential expansion in a market whose real expansion at best is only linear.

Hence the well known seven year business cycle and the larger total collapse every sixty or seventy years.

All you so-called liberals need to read Marx.

Jack Jersawitz
404-892-1238
bigjackjj@yahoo.com

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]

The Money Masters is a good film to watch on this issue. You can find it on Google video.

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]

Greenspan's policies were a total disaster. His legacy is still sowing disaster - the current housing slump is directly attributable to Greenspan.

[« Reply to this comment] [Post a new comment »] [Rate this comment: 1 - 2 - 3 - 4 - 5]