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Greenspan's Bubbles: The Age of Ignorance at the Federal Reserve Hardcover – February 6, 2008
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From the Back Cover
PRAISE FORGREENSPAN'S BUBBLES
“After reading Greenspan's Bubbles you will have no respect for the Fed! It's a must-read…in it, the authors demystify the belief that the Fed 'solves' problems when, in fact, it is directly responsible for a colossal destruction of wealth of the median household and of the U.S. currency through its irresponsible monetary policies.”
-Marc Faber, editor of the Gloom, Boom & Doom Report
“Greenspan for Mt. Rushmore? Not if Bill Fleckenstein has anything to say about it.”
-James Grant, editor of Grant's Interest Rate Observer
“In his typically engaging style, Bill Fleckenstein pops the Greenspan bubble…presenting compelling and convincing evidence that the former Fed chief got us into this mess...”
-Herb Greenberg, Senior Columnist, MarketWatch.com
“Before Ben Bernake shovels more cash into the U.S.'s money trap, he should read Greenspan's Bubbles, a damning account of how his predecessor inflated two asset bubbles that mutated into $11 trillion in home mortgage debt.”
“Alan Greenspan was dubbed history's greatest Federal Reserve chairman upon his retirement in 2006, but the housing bust is prompting renewed criticism of his laissez-faire brand of monetary policy. Hedge fund manager William Fleckenstein is among the loudest critics. Fleckenstein is the author of Greenspan's Bubbles: The Age of Ignorance at the Federal Reserve. He views Greenspan's legacy as a litany of too-low-for-too-long interest rates that created the dot-com and housing bubbles.”
--US News & World Report
“I suggest that you read Greenspan's Bubbles, a recent book by William Fleckenstein. It'll knock your socks off.”
--Copley News Service
About the Author
William A. Fleckenstein is president of Fleckenstein Capital, a money management firm based in Seattle. He writes a daily Market Rap column for his Web site, Fleckensteincapital.com, as well as the popular column Contrarian Chronicles for MSN Money.
Frederick Sheehan is a former Director of Asset Allocation Services at John Hancock Financial Services. He has written for Marc Faber's Gloom, Boom & Doom Report, Whiskey & Gunpowder, and the Prudent Bear Web sites.
Top Customer Reviews
Given the current state of the housing market, readers of 'Greenspan's Bubbles' might be prompted to ask whether Greenspan feels any culpability for luring unsuspecting homeowners into adjustable mortgage rates. Fleckenstein observes, "Greenspan was extolling the virtues of floating rate mortgages when interest rates were at the lowest they had been in over 50 years," suggesting that Greenspan ought to, even if he does not.
Certainly, today Greenspan expects Americans to believe he really didn't mean what he said when he endorsed ARMS. However, this book asserts that Greenspan blew serial bubbles in the stock market and real estate by keeping rates too low too long, thereby inviting reckless speculation.
Fleckenstein likens normal cycles of economic ups and downs to going to a party, imbibing in a few drinks, and feeling kind of shaky the next day. However, Greenspan's take on the economy was to entice Americans to throw down fifty metaphorical shots of tequila to keep the party going.Read more ›
Managing a $13 trillion economy is an awesome responsibility. Surely we need a Fed Chairman who has exhaustively studied fiscal history and who can recognize important inflection points so that he can maintain economic moderation and stability. Sadly for us, Greenspan wasn't that guy. It was Greenspan's loose monetary policies - the Greenspan Put! - that spawned the right conditions for bubble development. And we didn't have just one bubble -- the stock market bubble that burst in 2000 was the first we'd had in over fifty years -- we had two, a stock market bubble AND a real estate bubble . . . and they were both enormous! We'll be feeling the effects of Greenspan's irresponsibility for a long time to come. As Fleckenstein explains so well, the current subprime debacle is yet another example of bubble fallout. This is why this book is invaluable. If you truly want to process how we arrived at this juncture, then here's your guide.
Fleckenstein is a colorful writer. For what could have been a boring, complex, and even technical dissertation, Fleckenstein manages to make it understandable in a wit + candor style. The first two chapters are somewhat tedious and might I even suggest, "numbing," but don't let that dissuade you. The content rich middle and concluding chapters absolutely sing. The book is informative, thought-provoking, and just the right amount of information to digest. To me, that's five-star worthy.
"Greenspan's Bubbles" points out that he supported S&L deregulation as a paid consultant for Lincoln S&L (costing over $100 billion for taxpayers to bail out). During his '87 confirmation, Senator Proximire pointed out that Greenspan's forecasts at the Council of Economic Advisors were way off, and in some years, the worst of all.
Greenspan helped cause the mid-90's stock market bubble by lowering interest rates when it was not required; instead of admitting this as a mistake, Greenspan declared the market's level as indicative of Wall Street's wisdom on new ways to value stocks. Further acerbating the situation, Greenspan participated in and led efforts to change inflation measures (lower), thus appearing to call for less money tightening.
Contrary to Greenspan, former Fed Chairman Paul Volcker observed in 1999 that the stock market's growth was dependent on 50 stocks - half of which had never reported any earnings. (Definitely a "bubble-seer.")
In 2005 Volcker also pointed out that the housing market had become a vehicle for borrowing as much as a source of financial security. Greenspan, however, saw rising subprime loans as the "benefit" of increased lender productivity through the use of new technology.Read more ›
Most Recent Customer Reviews
I met the author at one of the Investment conferences. Not a very pleasant man. Very much obsessed with his net worth. Read morePublished 5 months ago by baby9798
well, apparently, there have been many reviews on this book in which I am not getting into..my simple conclusions are i) author is really one stop short of calling Maestro's act as... Read morePublished on June 20, 2014 by David Ip
This examines the Greenspan legacy of two bubbles and excessive monetary devaluation.
Fleckenstein blames Greenspan for the 2000 technology bubble and the 2008 real estate... Read more
I have ordered the book from the local library. The author gives the truth to the lies that were being spread by Mr. Infallible himself. Read morePublished on September 11, 2013 by D. Depperman
It's a fascinating read, and a real eye opener on the revisionism of history that can occur with these political figures and policy makers post retirement. Read morePublished on January 18, 2013 by Andrew Cunningham
William Fleckenstein runs a money management firm, and writes several columns. He summarized in the Introduction to this 2008 book, "Greenspan erred by continually picking an... Read morePublished on June 21, 2012 by Steven H Propp
If you read what Greenspan wrote back in the Ayn Rand days it is clear that he knew better. After that he sold out to the big money guys and by the time he was made Fed Chairman he... Read morePublished on May 11, 2012 by Henry B. Coons
I am young so I was not aware of many of Greenspan's policies when he was in charge of the Fed. I just remember my mother complaining that everything he did had one purpose: to... Read morePublished on May 18, 2011 by neededaname