Well, maybe to clarify, I don't want to let it be believed that I think that everything Greenspan did was bad. One can argue that he did indeed a pretty good job until 1998-99. The response in 1987 was probably the right thing to do (although it also brought in a few heady years followed by a nasty recession), and his calls in 1994-96 were indeed pretty good (and in 1994 he did buck the markets by increasing the Fed rates somewhat unexpectedly).

Where he erred, and is all the more inexcusable after his "irrational exuberance" speech in 1996, is when he decided to encourage the dotcom bubble (all the talk about a "new economy" and increased productivity) - and then when he compounded that by creating a bigger bubble, which he has so far managed to keep alive until beyond his retirement.

He has not solved problems in the past 7 years, he has just pushed them under the rug, while making them a lot bigger. He has also been a hack in encouraging Bush's insane tax cuts and in encouraging his Social Security plans - when he was the guy that raised the payroll tax in 1983 to fill up the SS reserve fund (the "lockbox") to make SS fully solvent. In effect, he made the middle classes overpay for 20 years, and then he helps give out the surpluses to the very rich. Hack, hack, hack.

He could have spoken out against the bubble in 1996/7/8/9. He had the credibility to stop the worst excesses. He chose not to, and he is fully responsible for that, and all the consequences of that, and the snowballing he also chose to go for.

In the long run, we're all dead. John Maynard Keynes