Some might consider Greenspan to be the greatest HYPER-INFLATIONIST since John Law in the 1720's...
Yet in the financial media Greenspan is often called an "inflation fighter"...what gives.
Clearly Greenspan has been given a unique set of circumstances that will likely not repeat for Bernanke in 2006 and beyond...
Essentially, Greenspan was allowed to be an ASSET HYPER-INFLATIONIST because Free Trade and globalism managed to reduced the price of manufactured goods and surpress private sector union wages in the US.
Of course there were consequences for this opportunity. The trade deficit soared. The US became "de-industrialized" to rid itself of "union jobs."
It was this bi-polar economic anomaly that "allowed" Greenspan to hyper-inflation "assets" which are the primary source of income for the "rich." Even while wages and prices at the level of the working classes went down.
Greenspan fought wage inflation tooth and nail...and he had the unique opportunity to preside over the one-off deindustrialization of the American economy...as jobs migrated to China and other low wage economies.
Of course hyper inflation always has a price to pay... The massive hyper-inflation in stocks and housing was only possible because private sector, unionized, high value added jobs disappeared in the US during Greenspan's time in office.
But the asset inflation so beloved by Greenspan, Wall Street and the rich is now "sloshing" over into commodities as well. And remember the rich use the Greenspan Dollar to speculate WHEREEVER they can...not just in real estate and stocks.
Now we have hyper-liquidity specualtion in gold, oil, metals, gas and other essential commodities... And this, sooner or later, will cause PRICE PUSH INFLATION...even if wages remain depressed as Wall Street and Greenspan dearly hope...
But there are signs of labor unrest in America... The Republicans have used "wedge issues" to hoodwink the "Bubba Republicans" who have little or no investment in Wall Street; but that seems to be coming to its final crashing end nowadays.
Pensions are disappearing. Health Care is out of sight for many. Wages are depressed and attacks on companies like Walmart are frequent.
In short the "Republican Magic" of low cost wedge issue politics seems to be ending. Indeed, globally the move toward populist agendas is proceeding apace. There are the new "Latin Lefties" winning elections in South America. The protests against the WTO are constant. The "have nots" of the world are finally waking up to the fact that "freedom" is worthless if it's only the "freedom to starve" or the freedom to work for less than a living wage.
GREENSPAN'S MAGICAL BI-POLAR ECONOMY IS ENDING...AND THE STORY OF 2006 WILL BE THE STORY OF ORDINARY PEOPLE REASSERTING THEMSELVES IN THE POLITICAL ARENA...
THE REAGAN/GREENSPAN REVOLUTION IS OVER....1985-2005.
