Press-Republican

Columns

December 15, 2013

Ex-Fed chairman helps with new financial rules

Perhaps there is redemption after a Fed chairmanship after all.

There have been three chairmen of the Federal Reserve Board of Governors in my adult life. In the month of my 20th birthday, Paul Volcker was appointed, just in time to try to guide us through the most inflationary recession in recent economic history. His name became a household word as people wondered why the most potent economist on the planet could not bring our economy back to normal more quickly and less painfully.

Alan Greenspan followed Volcker’s tumultuous and challenging years. Greenspan rose to the position on the wave of Reagan deregulation. An ardent Ayn Rand devotee, Greenspan believed that almost all markets, and especially financial markets, benefit most when they are regulated the least. Like many ideologues, he saw little value in nuance, and preferred broad and sweeping conclusions to the usual “on the one hand, on the other hand” approach of more highly trained economists.

Greenspan’s philosophy was embraced by Bush I, and then Clinton. In fact, the Clinton administration was far more zealous in its financial market deregulation than Reagan had been. Greenspan, and his ideological brother, Larry Summers, orchestrated the passing of provisions that ensured the burgeoning financial derivatives industry would remain essentially out of the reach of regulation.

When Greenspan’s philosophy led to the Credit Default Swap meltdown, the freefall of AIG into the federal government’s nicely padded safety net, the freezing of global financial markets, and the worst recession since the Great Depression, he left one stinking mess in the lap of Ben Bernanke. Poor Ben. He definitely did not see that coming. And, Alan Greenspan almost apologized when he admitted that his unqualified faith in unfettered markets may have been a bit misplaced.

Things have come full circle. The first of this trio, Paul Volcker, was asked to come up with some regulations that would prevent a financial meltdown from occurring again.

Text Only | Photo Reprints
Columns
  • Terry_Mattingly.jpg Easter with doubters and the 'nones'

    Should more pastors ask this blunt question: "Do you really believe Jesus was raised from the dead?" wonders religion columnist Terry Mattingly.

    April 18, 2014 1 Photo

  • Black_Peter_2014_cropped.jpg Canadiens are Canada's team

    The National Hockey League playoffs are underway, and for Canadiens fans, many of whom likely reside in the Montreal "suburb" of Plattsburgh, it is a time of hope and joy.

    April 18, 2014 1 Photo

  • little_mug.jpg There's no saw like an old saw Kaye and I laughed ourselves silly the other day as we tried to top each other with our own sayings from childhood, columnist Gordie Little writes.

    April 13, 2014 1 Photo

  • Denenberg_Stu1.jpg Privacy concerns make a comeback

    There's a growing concern amongst the millennials, columnist Stu Denenberg writes.

    April 13, 2014 1 Photo

  • paul_grasso.jpg Several options exist for downtown

    Pedestrian mall just one idea that could be good for city's economic future, according to columnist Paul Grasso.

    April 13, 2014 1 Photo

  • colin_read.jpg Government can't create success on its own

    It takes a grass-roots community effort of people working together to assure future accomplishment, according to columnist Colin Read.

    April 13, 2014 1 Photo

  • Hagar_mug1.jpg Farmers strive for sustainability

    Conserving the land and assuring long-term profitability are two of the key goals for farmers these days, according to columnist Peter Hagar.

    April 13, 2014 1 Photo

  • Black_Peter_2014_cropped.jpg Big shift in Quebec vote

    Being a man of science, Philippe Couillard, premier-designate of Quebec, chose to use a geological term (though his field is actually medicine) to describe what happened in Monday's election, writes Canadian columnist Peter Black.

    April 11, 2014 1 Photo

  • Terry_Mattingly.jpg A monastery in the Hebrides, after 1,000 years

    Before Father Seraphim Aldea can build a monastery on Scotland's Mull Island, he needs to have a working septic system, writes religion columnist Terry Mattingly.

    April 11, 2014 1 Photo

  • Tobias_Sue_012914.jpg Old movies offer more than entertaining TV

    Columnist Susan Tobias and her husband, Toby, are reminded of simple childhood memories while watching an old black-and-white movie.

    April 9, 2014 1 Photo

Peter Black: Canadian Dispatch

Lois Clermont, Editor

Cornell Cooperative Extension
Richard Gast: Cornell Ag Extension

Bob Grady

Guest Columns
Peter Hagar: Cornell Ag Connection

Health Advice

Ray Johnson: Climate Science
Gordie Little: Small Talk

Terry Mattingly: On Religion

Steve Ouellette: You Had To Ask

Colin Read: Everybody's Business

Pinch of Time