FREE ESSAY ON ALAN GREENSPAN

ALAN GREENSPAN

Since Alan Greenspan became chairman of the FED, the country's economy has reflected many
positive results. He has done a terrific job. Allan is a very bright man who is always
thinking of ways to prevent problems before they happen in the economic sector of the
nation. All economists have been very content with his job just until now. In a recent
Time magazine article called Is That Really You, Allan?disapproval about some new rules
that this man has suggested for the economy have been highly critized.
The first new rule that Alan proposed was to keep down with producivity. In the article
he responds to this new rule by saying that too much efficiency pushes demand and becomes
inflationary. This meaning that too much is produced and stock prices are getting higher.
When this happens people begin to feel very wealthy and start to buy and buy like crazy.
This is something that can cause major inflation in a future. Alan's second rule is to
keep stock market prices not rising more than 5% to 6%. Greenspan comments that this has
to be done because shares should rise only as fast as the rest of the economy. 
These two new rules proposed by Alan are mainly to protect the country from inflation and
many economists and other people don't understand it. The article also reflects that many
people think that Alan is doing the wrong thing. This is mainly because they are not
getting the economic benefits they wish and are not thinking about the country's economic
future. A very clear example is given in this article as well. The chief economist of the
Deutsche Bank, Edward Yardeni states that, If the wealth effect continues to boost
demand, then why can't productivity continue to boost supply? I really think that this
comment was really said in an angry and ambitious way. This is an economist of a bank and
should really try to understand that what Alan is trying to do is right. I also think
this man is seeking only his own benefits.
The chairman's decisions have brought many investors to worry. But just as Edward
Yardeni, all these people are only thinking about the harm these rules will bring to
their own selves. They are not aware that what Alan is doing is taking precautions so
inflation will not invade the economy in the coming years. He has done a marvelous job
with the economy and he has always been right with all the decisions he has taken. People
have to understand that like all the times before, he is doing the right thing again.
When the economy gets stabilized and it's growth rate reaches a normal percentage,
everyone will thank Alan once again from keeping inflation away. People just have to wait
and see what happens with this new rules. This has happened many time before. Alan
Greenspan has predicted something bad was going to happen and acted right away. After
some time, everything turned back to normal. He is a man who has been working and getting
the best out of our economy for many years now, and people should rely fully upon him.
His experience in this area will not allow him to commit a silly mistake and ruin the
whole country.