Heroes and Zeros

Former chairman, Federal Reserve Board

"Whatever regulatory changes are made, they will pale in comparison to the change already evident in today's markets. Those markets for an indefinite future will be far more restrained than would any currently contemplated new regulatory regime." -- Testimony before House Committee on Government Oversight and Reform, Oct. 23, 2008

Bubbles are disastrous for the economy. Apparently the bespectacled economist never learned this lesson during his 18 1/2 years running the Fed.

It's hard to imagine any single person more responsible for the biggest financial crisis to hit this country since the Great Depression. Let's review: Greenspan helped inflate the housing bubble by keeping short-term interest rates too low for too long. He did the same thing in the late 1990s, helping to fuel the dot-com bubble. He pooh-poohed attempts to regulate complicated derivatives, those exotic financial contracts that provided cover to lenders pocketing extraordinary profits by issuing reckless home loans.

When testifying on Capital Hill this fall, Greenspan blamed today's financial crisis on "a once-in-a-century credit tsunami." A sincere apology might have been more appropriate. --L.O.

NEXT: Zero: Ed Yingling