Greenspan passed away today, I looked up this person's life story

Greenspan, this person, is basically the first generation "market rescue master" of the Federal Reserve
He worked at the Federal Reserve for 18 and a half years
From 1987 to 2006
He experienced four U.S. presidents
Just two months into his term,
The US stock market encountered Black Monday
The Dow plummeted 22.6% in one day
A normal person just starting work would probably have begun writing a resignation letter after such a drop
But Greenspan only said one sentence:
The Federal Reserve is prepared to provide liquidity, support the economy and the financial system
Translated, it means:
Don’t panic, Daddy Central Bank is here
And then the market really stabilized
Since then, Wall Street discovered one thing:
No need to fear when the market has trouble
The Fed will save it
The 1990s was his peak
Low inflation
Low unemployment
High growth
The US economy entered what’s called the “Golden Hair Girl Economy”
Not too hot, not too cold
Just right
In 1994, he also did a fierce move
Inflation hadn’t risen yet
Raised interest rates 7 times in one year
The entire market scolded him at the time
Later, it turned out he really kept inflation under control
The most impressive was the internet revolution of the 90s
Traditional economics says low unemployment leads to inflation
But Greenspan looked at micro data,
At computers, the internet, productivity
Finally judged:
This time is different
Then he withstood the pressure not to raise interest rates
Allowing the US to enjoy the longest economic expansion
But problems also started from here
In 2000, the internet bubble burst
In 2001, 9/11 happened
Greenspan directly cut interest rates 11 consecutive times
Lowered rates from 6.5% to 1%
The market fully understood:
When it drops, someone will rescue it
When it crashes, someone will catch it
When there’s a loss, someone will back it up
This is later called “Greenspan put”
In simple terms:
Wall Street can confidently gamble
As the Fed will clean up the mess
In his later years, he started raising interest rates
17 consecutive times, each by 25 basis points
Seemed very elegant, very precise
But mortgage rates just wouldn’t come down
Long-term rates also didn’t listen
He himself was confused
Said it was a “mystery”
Even more absurd,
He always believed Wall Street would self-regulate
Derivatives didn’t need regulation
CDS didn’t need regulation
Subprime loans didn’t need regulation
Because financial elites would stay rational for their own interests
But a few years later, everyone saw
Financial elites were indeed very rational
Rational enough to blow up the whole world together
So Greenspan is a very complex person
The first half of his life as a master
The second half as a bubble engineer
He rescued the market
But also spoiled the market
He created the prosperity of the 90s
And also planted the bomb for the 2008 financial crisis