As the equity market bubble continues to burst, corporations hemorrhage red ink and the average investor’s net worth shrinks like a cotton t-shirt inside a dryer set on high, it is becoming increasingly popular to criticize the chairman of the Federal Reserve, also known as The Genius That is Greenspan.
TGTG, of course, insists that he is not to blame for the ongoing equity debacle. He argues that not only are the wild outbursts of speculation that characterize an investment bubble totally unpredictable, but unstoppable as well. Why? Because, in his own words earlier this month, “changes in margins (the amount an investor is required to deposit in his brokerage account) are not an effective tool for reducing stock market volatility.”
This would, of course, seem to fly in the face of what TGTG said on Sept. 24, 1996, when he admitted “there is a stock market bubble at this point … We do have the possibility of raising major concerns by increasing margin requirements. I guarantee that if you want to get rid of the bubble, whatever it is, that will do it.”
Some say that TGTG is incompetent. Others claim that while he was fully aware of the implications of feeding a high-octane money supply into the overheated engine of the stock markets, he was too frightened of the recession that would inevitably follow to turn the pump off. Others feel that TGTG simply reveled in the glory of presiding over what was thought to be the greatest period of prosperity in human history, which brought him a knighthood among other things.
Regardless, there can be little doubt that the implosion of the equity markets will soon be followed by the pricking of the credit and real estate bubbles. As great financial houses such as Citigroup and JP Morgan Chase teeter on the edge of bankruptcy, it is well within the realm of possibility that the triple whammy of the equity, credit and real estate implosions will lead to the collapse of the entire global financial system.
And all thanks to TGTG. My hero.
You see, I reject the notion that TGTG is incompetent, cowardly or vain. I contend that he is a superhero, an agent undercover, a mild-mannered chairman of the Federal Reserve Board by day and a freedom-fighting Randian titan by night. Consider the two following quotes:
“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 … 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.”
– Alan Greenspan, “Gold and Economic Freedom,” 1967
“The substantive financial powers of the world were in the hands of these investment bankers (also called “international” or “merchant” bankers) who remained largely behind the scenes in their own unincorporated private banks. These formed a system of international cooperation and national dominance which was more private, more powerful and more secret than that of their agents in the central banks … They could dominate governments by their control over current government loans and the play of the international exchanges.”
– Carroll Quigley, “Tragedy and Hope,” 1966
It is clear that TGTG, from his humble beginnings as an acolyte of Ayn Rand, has been secretly determined to shoulder the weight of the financial world on his shoulders, then, like Samson in the temple of Dagon, bring it down upon himself and his fellow Masters of the Universe who are holding us captive in endless financial serfdom. Hard days may lie ahead, but soon the day will come when there will be no more Federal Reserve, no more confiscation through inflation, no more federal debt, and no more unconstitutional income tax.
America will be free again, all thanks to my hero, the genius that is Alan Greenspan.