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Alan Greenspan: Better Than Predecessors, Not As Good As Gold

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I've read that Gordon Brown (Chancellor of the Exchequer here in the UK and next in line for PM's job) has approached Mr. Greenspan with an eye to him becoming a special advisor on economics to our Uk government. It is a strange thing for me to consider that the man who wrote three essays included in Ms. Rand's C:UI would now be giving advise to the UK's socialist-leaning leaders to help them to maintain the status-quo with regards to their pet-projects, and even to improve how they steal our money <_<

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  • 2 weeks later...

It goes to show how the motivation of americans to live and their resiliency overcome the destructive behavior of the fed. Even when the fed is haphazardly raising and lowering rates like excited schoolchildren on a seesaw the businessmen bravely charge ahead.

It also goes to show how clueless many americans are. They are comforted when the rates go down but they don't know why or care. It seems there is a spread of rates where the economy can tolerate "legalized theft" (up to as much as 8 or 9% for sustained periods during his intital years) before they start voting with their feet and start marching out of the markets. This seems to be when their subconcoius say a little stealing of my money is ok, if it is the government, but only to a point.

Alan Greenspan is lucky that people don't have a clue or else he wouldn't be known as the benevolent rate adjuster, he would be known as the subjective wealth destroying, recession causing hermit.

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I've read that Gordon Brown (Chancellor of the Exchequer here in the UK and next in line for PM's job) has approached Mr. Greenspan with an eye to him becoming a special advisor on economics to our Uk government. It is a strange thing for me to consider that the man who wrote three essays included in Ms. Rand's C:UI would now be giving advise to the UK's socialist-leaning leaders to help them to maintain the status-quo with regards to their pet-projects, and even to improve how they steal our money :)

It is not strange at all when one considers that in his tenure as head of America's central bank Alan Greenspan betrayed every principle that he set forth in his essay "Gold and Economic Freedom," (included in Ayn Rand's magnificent Capitalism: the Unknown Ideal). In his incisive and uncompromising piece, Greenspan made this vital point:

The abandonment of the gold standard made it possible for the welfare statists to use the banking system as a means to an unlimited expansion of credit. They have created paper reserves in the form of government bonds which-through a complex series of steps--the banks accept in place of tangible assets and treat as if they were an actual deposit, i.e., as the equivalent of what was formerly a deposit of gold. The holder of a government bond or of a bank deposit created by paper reserves believes that he has a valid claim on a real asset. But the fact is that there are now more claims outstanding than real assets. The law of supply and demand is not to be conned. As the supply of money (of claims) increases relative to the supply of tangible assets in the economy, prices must eventually rise. Thus the earnings saved by the productive members of the society lose value in terms of goods. When the economy's books are finally balanced, one finds that this loss in value represents the goods purchased by the government for welfare or other purposes with the money proceeds of the government bonds financed by bank credit expansion.
http://www.321gold.com/fed/greenspan/1966.html

However, as Fed chairman, Greenspan did nothing to reverse this process of using "the money proceeds of the government bonds financed by bank credit expansion" for "welfare or other purposes." In short, he went right along with the Keynesian, rights-violating, reality-evading process of artificially expanding the money supply to finance (big) government. "Giving advise to the UK's socialist-leaning leaders to help them to maintain the status-quo with regards to their pet-projects, and even to improve how they steal our money" is what Mr. Greenspan has been doing in America ever since Reagan appointed him as Inflator-in-Chief. Thus, he is highly qualified for his new position.

And here's this from Dr. Leonard Peikoff's radio program of February 22, 1998:

Now, Alan Greenspan has muffed his chance, time and again, in Washington. I don't ever hear him making a strong, pro-capitalist statement. I don't see him taking any actions in his year-after-year, of tenure, to free anything in the economy. And this despite the fact that I know from first-hand knowledge that he's a highly intelligent man who knows better. He knows what Capitalism is, and does. When he was on the Social Security commission, he helped them to save the rotten institution, rather than to phase it out. He knows enough about markets to know that you do not denounce a market for being irrationally exuberant. This man is going against every one of the ideas that I know he understands. For him to say it's good for business, which means affirmative action is good for business, to hire unqualified people, or to say it's good for our society, which means it's good for our society to have forced relationships at the point of a governmental gun, or for him to say this is the right thing to do, which means to elevate alleged collective demands over individual rights, and to prey on guilt, sacrificing those who are qualified to those who are needy, regardless of what the source of the need or the qualification is, this is complete, utter betrayal of everything that I know Alan Greenspan knows.

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In Objectivism, Greenspan is to economics as Branden is to psychology.

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In Objectivism, Greenspan is to economics as Branden is to psychology.

Well put.

Since I was in high-school I've wondered what happened to the man. I'm always interested in hearing more that will help me understand it, and this article has.

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