Episode Details

Alan Greenspan served 19 years (5 terms) as Chairman of the Federal Reserve from 1987 to 2006. Alan followed Paul Volcker and was appointed by President Ronald Reagan. Alan was a highly intelligent man, a great economist, who could be funny (in his own way), charming, eloquent, and very likeable. He served under both Republican and Democrat Presidential administrations, getting along with both parties. Alan became a ‘rock star’ in the 1990’s as the rise of cable TV, the creation of business news network CNBC, and the Fed’s increased commitment to more communication led to a new kind of attention on the Fed Chair.  The news media and politicians would hang on to his every word, trying to decipher his ‘green-speak.’ Alan became known as the ‘maestro,’ for his mastery of managing the U.S. economy. However, everything was not pleasant during his tenure as he had to deal with the 87-stock market crash, a recession in the early 90s, and the dot-com bubble bursting in 2000 along with 9/11. Alan was not without his missteps. During the 90s, Alan allowed asset price inflation, which helped the economy to boom, but ultimately led to the dot-com bubble. Alan became known for the phrase ‘irrational exuberance’ in the market. Alan then lowered interest rates in the early 2000s and kept them low for too long, which again helped the economy to boom leading to a real estate bubble that burst in 2007. Alan’s legacy is complicated. He was a great Chairman of the Fed, maybe the greatest. At the same time, he ushered us into the age of bubbles. To this day we are still dealing with the ramifications of that. This episode examined articles from CNBC, The Wall Street Journal, and Investopedia.