The Central Bank — Grandchildren of Old Man Greenspan at the Fed!

2006/4/27 22:24:28

Old Man Greenspan — at the very least, that's not a curse word inside the Fed. Although Old Man Greenspan has already departed, Old Man Greenspan's era continues. The continuation and expansion of an era ultimately depends on people. Just ask our friend Confucius about that.

Confucius had no other real skills — his one stroke of genius was bamboozling three thousand disciples, among whom were the famously devoted seventy-two personal bodyguards. China's population back then was probably only around fifteen million, so with three thousand disciples all spawning generation after generation of intellectual offspring to carry on the bamboozling, it's really not surprising at all that China got bamboozled for over two thousand years. And now Old Man Greenspan's intellectual progeny have spread across the globe too — is Old Man Greenspan also going to bamboozle the world for two thousand years?

Being one of Old Man Greenspan's intellectual progeny, of course, isn't something any random Tom, Dick, or Harry can pull off. At the very least, you need to be holding the official seal of some major country's central bank, chanting Old Man Greenspan's name on one hand while waving the yield curve around with the other — certainly more entertaining than whatever Tom, Dick, and Harry are up to. And this Greenspan Method has truly been hyped to divine status: a single yield curve can whip the world into becoming a world of yield curves. The world turns out to be that simple — with the Greenspan Method, even Tom, Dick, and Harry can run a central bank.

But the world is just the world, and can only world its way through being the world — it was never something a yield curve alone could world into submission. The yield curve exists only in the world's imagination. Imagination can bring its own pleasures too — one can ride the clouds and turn the rain in dreams as well — and of course, the yield curve can be useful too. When Old Man Greenspan's yield curve method went a bit haywire around 2000, the real assassins were already quietly amassing massive positions in resource-based assets. Old Man Greenspan's tricks only fool the grandchildren who can be fooled by him. The assassins have their own way of playing — riding the yield curve, the assassins have set off once again!