THE POWER OF GREENSPAN
"Who needs gold when we have Greenspan?"
The New York Times, May 4, 1999
"Greenspan comments trigger afternoon sell-off"
The Financial Times, May 7, 1999
"Greenspan speaks: the world trembles"
The European, July 27, 1998
"Street revels in the Greenspan rally, but will it last?"
Barron's, October 19, 1998
"All eyes on Al"
The Economist, September 26, 1998
"Greenspan's words taken for golden"
The New York Times, September 8, 1998
He has never held elected office or starred in a Hollywood
block-buster. He has never created or commanded a huge multinational
corporation. He has never birdied at the Masters, or shattered a home
run record. In fact, his chosen profession is almost the antithesis of
the power we associate with a President or a dictator, the glamour of a
movie star, the bold vision of a pioneering entrepreneur, or the
physical achievements of a sports superstar.
He is an economist. He toils in the dry vineyards of what John
Maynard Keynes referred to as "the dismal science." Along with his more
obscure colleagues, he would seem to define everything that is clinical,
unsexy, rarefied, and irrelevant.
Economists? Rather than being celebrated for their decisiveness,
economists are derided for their ambivalence. Reacting to the constant
"on the one hand, on the other hand" refrain of his advisors, Harry
Truman wished aloud for a "one-handed economist."
And yet despite this unsavory pedigree, our subject has become a
megacelebrity -- known, respected, feared, scrutinized, consulted, and
quoted throughout the world. Like Madonna and Schwarzenegger, Gates and
Turner, Jordan and McGwire, he is a single-name household word:
Greenspan.
Greenspan's stature and power are celebrated almost daily in the
business press. One journalist terms him "amazing"; another praises his
"magnetism." The impact of Greenspan's words on financial markets is a
constant theme: he is the "market leader"; "the market hangs on
Greenspan's words"; he is "the man who moves, and scares, markets."
At times, the rhetoric verges on the reverential: Greenspan's "miracle
cure"; Greenspan's "golden" words; Greenspan, the "high priest"; "In
Greenspan we trust." One journalist recently was bold enough to assert
that "Alan Greenspan isn't God." Would people write such things about
mere mortals?
Who is Alan Greenspan, and why are people writing these things about
him? As Chairman of the United States Federal Reserve System since 1987,
Alan Greenspan has emerged as one of the most influential actors on the
world economic stage. And although the Fed has played a key role in U.S.
economic affairs since its establishment in 1913, the institution has
never before wielded such influence, both domestically and
internationally. This is an influence, moreover, that is only growing
with each new financial crisis.
Potent, Mysterious -- and Comprehensible
The Fed's new potency results in part from the rapid
globalization of trade, banking, and economic policymaking in the last
generation. But it also results from the long shadow cast by its
remarkable chairman.
Part I: Greenspan, The Fed, and The Stock Market.
The Fed Chairman as World Celebrity.
The Fed's Levers of Power.
Part II: Words That Lift Markets.
David B. Sicilia, Ph.D, is an experienced consultant, business historian, and author. He has received numerous awards and fellowships, including the Charles Warren Fellowship from Harvard University and a Sloan Foundation grant for his work on stakeholder theory. Dr. Sicilia is the author or coauthor of numerous influential books, including The Engine That Could: Seventy-Five Years of Value-Driven Changes at Cummins Engine Company and The Entrepreneurs: An American Adventure.
