Alan Greenspan: his personality, his life

Undoubtedly, Alan Greenspan is a man that has few equals. And in learning about Alan Greenspan, it is possible to both appreciate the complex man that he is and also the diverse and rich life he has lived. His tenure as chairman of the Federal Reserve that lasted through various terms of 4 different presidents makes Greenspan one of the most venerated figures when it comes to the global economy. A brilliant mind many would argue, Greenspan did not characterize himself as a politician when asked by Maria Bartilomo on a CNBC documentary on his life. However, he did note that he knew how to ‘play the game’.

Greenspan’s tactics when it came to handling difficult questions are legend. Termed Greenspeak, Alan did an excellent job of reframing, redirecting, and even obfuscating responses to difficult questions.

As chairman of the Fed, Greenspan had the difficult job of explaining huge economics to average people and their elected officials. And it doesn’t come easy when the range of economics for people may be no more than what they buy at the grocery store v.s. someone who understands the global implications of the reductions in copper produced in mines due to warlords and civil wars in African nations.

Greenspan is well known for his interest in Music. This goes back to his days when he started out as studying the clarinet attending Juliard. Greenspan played the clarinet professionally for a time and then became aware that there were good musicians and great musicians. This prompted him to change his profession. Born to a father who worked on Wall Street, it is interesting to note that Greenspan ended up doing the same thing himself, albeit in a roundabout way.

Greenspan continues to speak. In fact, he has received numerous complaints about this fact. People respect Greenspan. During his CNBC interview with Maria Bartilomo he even quipped when asked if another major 20% crash could happen. Greenspan simply refused to answer. He indicated that when he answers hypothetical questions with hypothetical answers, somehow it turns into the fact that he predicted it.

Many people even blame Greenspan for things which are working their way through the economy today. In fact, the current sub-prime mortgage mess is attributed by some, to some degree, to the housing bubble, which many (including Greenspan himself) attribute to Greenspan’s decision to keep interest rates so low for so long. According to Greenspan, the housing bubble was “fundamentally engendered by the decline in real long-term interest rates.”

Understandably, Greenspan is now quite gun shy. And perhaps this is for the best. It is not just his past actions which are currently having an effect. It is even what he says and does in the present. Earlier this year, Greenspan forecast a possible recession in the U.S. before or in early 2008. The next day saw a significant drop in the Dow Jones Industrial Average of more than 400 points, the largest drop since 9/11.

The mystery of why people still rely on Greenspan for vital information is not that difficult to understand. When interviewed with Bartilomo, Greenspan stated that he was technically savvy. He owned a blackberry. When he worked with the Fed, he had a research team of 40-50 people to churn out massive amounts of data. Now, he needed only two or three people to churn out the same data. People know this. And no one thinks that Greenspan has stopped watching the global economy.

Today, Greenspan speaks all over the world for various gatherings of business people and other functions. He is retained by various groups of investors and banks including Deutsche Bank. It seems to me, that regardless of what he sets his mind to, as long as he has his health, he will provide great value and insight to those who listen.