Volcker made the tough decisions during tough times, that allowed us to prosper later. Greenspan and Ben seem to only try to appease the markets, without regard to the long term consequences. They are like the most popular parents among high school kids. They let everyone drink to their hearts content.
That wasn't true of Greenspan before the Tech bubble. He had a fundamental change in perspective during the tech bubble when he decided that the FED should get involved in the market. Before that he didn't see Wall Street as being anything more than a very minor factor in FED decision making.
A group was formed called the "Volcker Group" under Nixon. One of the first directives of the Nixon administration was the establishment of a permanent working group chaired by Under Secretary of the Treasury for Monetary Affairs Paul Volcker to make recommendations on international monetary policy. http://www.unc.edu/depts/diplomat/archives_roll/2002_01-03/frus_2002_03/frus_2002_03.html http://www.state.gov/r/pa/ho/frus/nixon/iii/5345.htm Though the papers cited in the State Department don't directly indicate Volcker's role in the suspension of gold convertibility, the subsequent interview on PBS confirms his involvement. Obviously we only have his side of the story here. INTERVIEWER: Were you at Camp David the weekend when gold convertibility was suspended? PAUL VOLCKER: Yes, I indeed was.....Arthur Burns, who was then chairman of the Federal Reserve Board, argued strenuously enough to suspend gold convertibility. He was really the only one who vigorously took that view. I think most of the rest of us who were involved thought the time had come and some approach had to be taken, and that the only practical move internationally was to suspend gold convertibility, which would lead to a depreciation of the dollar. IMO, that might be part of the reason he was such an inflation hawk. It seems that he saw eliminating gold convertibility as a necessity to save the US economy at the time, and the team that he presided over supported that action. This is not to say that he desired it, but rather thought it the only option. I suppose he then did everything he could to prevent inflation that was inevitable afterward. Also, Volcker has stated that it is his opinion that the world will inevitably have/need a single currency. Not saying that I agree or disagree with this.
Volker was the last finger in the dike and when the DC establishment made him blink....the fix was in.... and that was the start of the the current slide from which we may not recover without a dose of civil unrest behold your vanishing dollar....and I think there's a post elsewhere where the UEA will unpeg.... Abduhl...what took you so long?
The worst was Alan Greenspan. His tenure was all about volatility and instability. But one could argue that Greenspan was great for traders.
Look, I know you didn't come to this conclusion after a careful study of Fed chairmen and economics. Undoubtedly you're just regurgitating what you read somewhere on the internet by some idiot. But here's a few points to ponder. During Greenspan's 20 year tenure, there were only 2 recessions. One in 1990-1991, and one in 2001. Both mild. Prior to Greenspan's tenure, recessions came along an average of every 5 years since WWII. And some of these recessions were VERY severe, like the 1973-1975 recession. Or, perhaps you'd like to look at some of the prior inflationary cycles. Are you aware that at one time we had double digit inflation? Interest rates near 20%? And you call the last 20 years "all about volatility and instability"? LOL. In fact Tracy, the stock market during Greenspan's tenure rose 6-7 fold as measured by the S&P, with few significant corrections. The only big correction was 2000-2003, following which all the major averages have gone to new highs with the exception of the Nasdaq....to include Dow, SPX, Russell, Value Line, Transports, Utilities, etc. I hardly think Greenspan's tenure was "all about volatility and instability". You need to re-read your economic history. And while you're at it, go read a little about G William Miller and Jimmy Carter. OldTrader
OldTrader...I disagree the old money in DC really hated Volker for punishing type recessions that cleansed the system of weak credits.... Greenspan's downfall was that he used the Fed. to allow poor credits and marginal businesses to survive and act as an anchor on the system.... Wall Street came to be too dependent on cheap money to bailout the system....sure there were 6 fold increases in this or that... but the results of 20 years of poor policy are coming due right now... when Kuwait and the UAE unpeg from the dollar...there's a bad moon risin'