A mediocre, but highly tear jerking 1936 movie titled “The White Angel,” starred Kay Frances, and is the story of Florence Nightingale, the mother of the nursing profession. A three handkerchief movie. William Wadsworth Longfellow wrote a descriptive poem about the early day heroine, which bears the title of the movie The White Angel.”
How lucky those British troops were, when Florence and her band of 39, cleaned the hospital up, got some fresh air into the rooms, got rid of the rats, gave patients love, cleanliness, and attention. The death rate went down, and she became a symbol in history.
I am often accused of being a cynic. “How dare you criticize! Why, we have our own White Angel to protect us, and see to it that all is well. Our White Angel, is none other than Alan Greenspan, who lovingly looks after the dollar and our economy.” Well, maybe a quick look at Sir Alan would be of interest, since he is called, “The second most powerful person in America.”
Greenspan was born March 6, 1926 in New York City, the son of a stockbroker and retail worker. He was a whiz at figures, and studied music at Julliard. He even played a sax and clarinet in a swing band. He received a BS in 1948, (summa cum laude), an MA in economics in 1950, and a Ph.D (piled higher and deeper) in economics in 1977. All degrees are from New York University. He never wrote a thesis for his doctorate, but was given the degree without one, I suppose, because he got his first two at New York University.
Sir Alan, was a member of the inner circle of Ayn Rand’s associates, and has written several times about the advantages of returning to the gold standard. Greenspan seems to have an intense fear of inflation. This is strange, because his outfit will print a trillion new dollars in 2004, which obviously will cause ever more inflation. He became chairman of the Federal Reserve Board on August 11, 1987, and since then, we have had at least 400% inflation. Maybe his fears and dreads do not compute into accurate happenings. Or perhaps he doesn’t realize that, “The more of anything there is, the less they will be worth,” which is Stott’s law, and certainly applies to dollar bills.
Sir Alan has, and still does hold various and elevated titles and offices. He was Chairman and President of Townsend-Greenspan & Co Inc, an economic consulting firm in New York from 1974 to 1977, which he co-founded. He was Chairman of the President’s Council of Economic Advisers under Gerald Ford, and from 1981 to 1983 was Chairman of the National Commission on Social Security Reform. He was a member of Reagan’s Economic Advisory Board, member of Time Magazine’s Board of Economists, a senior adviser to the Brookings Panel on Economic Activity, and a consultant to the Congressional Budget Office. He was appointed to the President’s Foreign Intelligence Advisory Board, the Commission on Financial Structure and Regulation, the Commission on an All Volunteer Armed Force, and the Task Force on Economic Growth. He has served as a corporate director of Alcoa, Automatic Data Processing, Inc, Capital Cities/ABC, Inc., General Foods, Inc, J.P. Morgan & Co, Inc, Morgan Guaranty Trust Company of New York, Mobil Corporation, and the Pittston Company.
Greenspan has been on the boards of The Rand Corporation, Institute for International Economics, Hoover Institute, and Vice Chairman and Trustee of the Economic Club of New York. He has served as Chairman of the Conference of Business Economists, President and Fellow of the National Association of Business Economists, and Director of the National Economists Club. He has received honorary degrees from Harvard, Yale, Pennsylvania, Notre Dame, Wake Forest, and Colgate Universities. He has a lot of other awards, but I am tired of writing them all down. He, of course, was made a Knight Commander of the British Empire in 2002, and will henceforth be called “Sir Alan.” You can take all this, and a dollar, and get a cup of coffee.
Now that we have gotten past his honors, it would certainly be wise to point out that the stock market has long passed the mark at which he first warned of “irrational exuberance.” In other words, the stock market is due for a severe correction. One certainly can blame him for the run up of the stock market and subsequent crash. He insisted on immense amounts of “liquidity,” as he calls it, but the actual definition is pumping trillions of dollars into the economy. This resulted in large margins for stock buyers, day traders, and just tons of “irrational exuberance.” While warning of “exuberance,” at the same time, he was pumping up the dollar supply and making loans so easy, that the public decided the glory train would run forever. Interest rates were easy, and dollars everywhere. A hundred million or more Americans got on to the bandwagon Greenspan built, and never had such a good time. All things have to end of course, and the stock market did.
From the April 17, 2000 Financial Times: “Dow Plunges on Inflation Fears,” was the headline. “Market prices dropped last week because they were over inflated, and that’s what balloons do when you prick them. Greenspan helped play the role of the prick this time by threatening to hike interest rates, shaking a sensitive market uneasy about the possibility of a court-ordered split-up of Microsoft. Investors panicked, and acted as if they had some massive belated realization that most dot-com stocks have the same intrinsic value as Confederate scrip. Greenspan has resisted attempts from other Fed officials to take action that might have deflated some of the puff from the balloon economy. Above all, he fought grimly against attempts to limit the margins on brokerage accounts. By March 2000, the NYSE member firms alone had extended $278.5 billion in credit to wannabe millionaires. That was a 5 percent increase from February, which was itself an 8 percent increase from January’s number.” The bankruptcy of Long Term Capital Management was rescued by Sir Alan with billions of taxpayer dollars, and it is perhaps true that he is the second most important man in America.
The stock market is rising like the Phoenix Bird again, in spite of warnings from us pessimists. A pessimist in the stock market believes that P/E ratios shouldn’t be at the 30 they now are, but at perhaps a 10. Greenspan, realizing the tragic mistake he had made, quickly cut interest rates a dozen times in less than as many months, it seemed, and they now sit at a point where hundreds of millions have re-financed their mortgages at much lower interest rates, a huge bonanza for them if they acted wisely. Unfortunately, most haven’t, and have used their home equities to go on a national spending spree, which has made consumer debt about as high as is the national debt, not counting unfunded Social Security. How much? So much, that it is doubtful it will ever be repaid without total economic collapse.
While Sir Alan has guided America into a stock market crash, and other nefarious deeds, we must remember that he is only a bit player in the entire national economic scene, which could be likened to a thinly veiled Shakespeare tragedy. As Shakespeare’s tragedies have sad endings, it is possible ours will too, and this is why more and more Americans are waking up to the utter folly of paper money and thinblerigging politicos, who have voted endless largess from the public treasury to retain office, have debauched the national currency, and flooded America with worthless vermin who live on welfare. When these welfare recipients go to the polls, and they shouldn’t be allowed to, guess for whom they vote? Of course! The scalawag who promises them more from the welfare trough. The blame must go to Senator Snort and Congressman Loudmouth, for creating the Federal Reserve in the first place. The fact that White Angel Greenspan has violated his previous convictions, and gone along with the game, may speak poorly about him, but the main blame lies in the halls of Congress, and I know of no way of correcting it. As Will Rogers once said, “I don’t make jokes. I just watch the government and report the acts.” Protect yourself.