Why Presidential Appointees Matter

Back in 1992 the mantra of the Bill Clinton campaign was that “it's the economy stupid.” Surprising, since the majority of American campaigns for President have always been about the economy.

However since the 1970’s that economy has been changing dramatically and rapidly. It was only as far back as the Nixon administration that we were still on the gold standard. Things like derivatives didn’t exist. Subprime lending, globalization of money and creative destruction in the economy had not yet set up a paradigm for collapse.

Presiding over so much of this change, watching all of it and dire
cting some of it, was Alan Greenspan.  Towering over the Federal Reserve for 18 years and serving five Presidents, no one knew more about the inner and outer working of the American economy than Greenspan.

Now we get the first full scale economic and person biography of Greenspan in Sebastian Mallaby's The Man Who Knew: The Life and Times of Alan Greenspan.

My conversation with Sebastian Mallaby:

The Struggle to Create the Federal Reserve

It used to be, during the dark days of the Cold War, watching the Kremlin and trying to read meaning into every nuance, tea leaf and coming and going, was elevated to an art form.

Today, it’s the same for the Fed. Every meeting, every utterance of the Fed Chair and Fed Governors is parsed and analyzed and poured over for some hint of what the Fed will do and what it might mean for the markets, for the economy and for the politics of the country.

But it wasn’t always so. In the aftermath of the 1907 financial panic, Congress created the Federal Reserve. They did so for reasons not dissimilar to the state of our transitional economy today. But they did so in a spirit of compromise and national unity that seems a very far cry from anything that might happen today.

Putting all of this in its proper perspective is Roger Lowenstein in his new book America's Bank: The Epic Struggle to Create the Federal Reserve

My conversation with Roger Lowenstein: