4.06.00
Turning on Greenspan

4.04.00
Two Cheers for W.'s Environmental Message

4.04.00
A Well Endowed Democracy

4.03.00
An Unsettling Antitrust Case

4.03.00
The Ph.D. with the Lamp

3.31.00
Elian, Still in the Middle of the Ocean

3.31.00
The Clintonization of America

3.30.00
A Real Shipwreck

3.29.00
The Dead Baby Thing is So Over

3.29.00
Are Gun Locks Like Aspirin Caps?

3.28.00
Putin Together A Government

3.27.00
The Dangers of Mandatory Gun Locks

3.24.00
What Hath Ward Wrought?

3.24.00
Leave E-commerce Alone

3.24.00
E-mailgate

3.23.00
Senator, You're No Ronald Reagan

3.23.00
Against Microsoft: A Primer For Conservatives

3.22.00
Kessler Control

've been watching the market mayhem this week with the dispassion of someone too poor to have anything at stake. While several friends lost vast sums of money on companies that are run by 19-year-old CEOs, have no revenues and produce nothing, I was content watching CNBC to see if someone decided to crack the window and do the Black Monday swan dive. Although this never happened, something else that made for less compelling television did.

Throughout the financial world, investors were unleashing their venom on Alan Greenspan for a downturn in the Nasdaq they saw as his fault. This week, Greenspan assumed a new persona in the ever changing, ever complex relationship between Americans and the Fed Chairman.

The first incarnation was Greenspan as economic Svengali. With the omniscience of Yoda and the mysticism of Rasputin, he was perceived to be the sole cause of the economy's red-hot growth and the market's stratospheric heights. A few years back, a journalist fabricated a story about bond traders on Wall Street constructing a Greenspan shrine — and people actually believed it. In Washington, where politicians are usually given all the credit (or blame) for the ways of the world, people actually began to concede that (the horror!) an appointed official was actually pulling the strings.

Much of the cult surrounding Greenspan was ironic, given that the Fed Chairman took every possible occasion to raise a skeptical eyebrow about the "new economy" and bash the markets for being "irrationally exuberant." He was trying desperately to take away the punchbowl from a group of drunken day traders, yet investors still revered him as the chief source of their new wealth.

It was only when the Fed began its methodical campaign to raise interest that attitudes toward Greenspan changed. People figured out what Greenspan was up to, and the Fed Chairman morphed from being the wise leader of legions of investors to their aged sparring partner. It was no longer a question of how Alan Greenspan was going to make everyone money. It became a question of how everyone was going to make money in spite of Alan Greenspan.

And they kept making money. Despite a series of rate hikes, the Nasdaq skyrocketed for most of this year, fueled by a few dozen high-flying technology stocks. In this climate, Greenspan became almost a comic character: the bumbling old timer who has trouble figuring out the new economy in the same way your grandfather has trouble figuring out the remote control. The Fed could do what it wanted, but it would do little to stop the momentum of the financial markets.

The events of this week have called that belief into question, and things are starting to get nasty. Watching the financial networks and reading some of the stock message boards, it seems that Alan Greenspan has once again assumed a new role — Evil Overlord of the Bear Market. Like junkies turning on the dealer when they don't get their fix, many investors are turning on Greenspan for this week's Nasdaq shakeup.

Even more bizarre is the view that this is something Greenspan was secretly hoping for — a scheme he hatched in his wood-paneled office. This, of course, is absurd. Yet, Mr. Greenspan must have at least allowed a wry smile when thousands of investors had to make margin calls on the speculative Internet stocks they held. Greenspan has long warned about the dangerous levels of equity being bought on margin, and this fragile house of cards was seriously shaken on Tuesday.

So it seems that the financial markets still abide by the laws of physics, and Mr Greenspan's warnings were not simply the Fed Chairman being a closed-minded alarmist. Discounting the rantings of many vitriolic investors, he has actually been praised this week by economists for a steady hand at the rudder. As the front man, though, Greenspan will no doubt get saddled with the blame if both the economy and the markets should tank. On a recent trip to Boston College, he was introduced by Representative Ed Markey as the "Babe Ruth of our economic policy." Should things turn sour, he could just as easily become the economy's Bob Uecker.

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