Do I think that Alan Greenspan should shut up? Herb
Greenberg thinks
he shouldn’t, and so do I. But I don’t share Greenberg’s admiration for
the (erstwhile) Maestro. Rather, I think that the more Greenspan speaks, the
more of a rentaquote he’ll reveal himself to be, and the less he’ll be able
to move any markets at all.
In fact, Greenspan’s market clout is already severely diminished from the days
when he, you know, actually mattered. Insofar as he does move markets,
he only does so for a few hours or so, maybe a day at the most. And what’s more,
a lot of the market moves which are ascribed to him are in fact not quite as
causally related to his comments as many lazy journalists seem to think.
Whenever Greenspan says something bearish and the markets go down – any
markets, even stock markets in Europe – everybody seems to jump to the
conclusion that there must be a causal relationship between the two events.
But the fact is that whenever Greenspan says something bearish, some market
somewhere is bound to go down. Not because of what Greenspan said, but just
because, statistically speaking, there’s always one or two markets which are
going down rather than up.
The more that Greenspan speaks, the more obvious his utter lack of market-moving
influence will become. So speak, Maestro! Then we can all get on with ignoring
you.