There Was a Time When This Was Known As ‘Talking Down the Economy’
In November 2000, during the disputed presidential election won by George W. Bush (excuse the indulgence; I just enjoy typing those words, especially considering the alternative), Dick Cheney and others were (in hindsight, rightfully) pointing to negative indicators in the economy pointing to a possible recession. Furious supporters of what was to become the previous administration accused Cheney of “talking down the economy” — a charge that was lapped up by the Mainstream Media at the time.
It was nonsense, of course. But if you really believe that a soon-to-be-Vice President can “talk down the economy,” a former Federal Reserve Chairman, Mr. “Irrational Exuberance” himself, who may still have at least informal access to information many of us don’t, can be fairly accused of the same thing — can’t he?
Where are those who were on Cheney’s case now?
Cross-posted at NewsBusters.org.
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UPDATE: Greenspan probably can’t talk down the economy, but yesterday at least one writer believed that he (Greenspan) could talk down the market for a day. Update extension: Commenter Kevin disagrees below, and makes a very good point about the immediate market reaction. My thought would be that maybe it took the market a little time to digest what Greenspan had to say and to gauge the reaction of other key people to what he said. After all, he couched a lot of his speech in the famed Greenspanese we came to know and sort of love during his reign as Fed Chairman. Further extension: This may come to be known as the week Greenspan sunk the markets if this stuff keeps up.
RE: your update…
That’s not the case. The Greenspan news appeared in the WSJ Online at 5:37 AM on Monday. When news about macro trends breaks or earnings is announced, the market typically responds in a 30 minute window. That would have affected yesterday’s trading day. The pullback today relates to the profit taking and sharp decline in the Chinese capital markets. That decline is in response to regulatory fears, not Greenspan’s speculation.
Comment by Kevin — February 27, 2007 @ 12:19 pm
#1, Thanks for the info. I modified the UPDATE sentence and supplemented to refer to your comment.
Comment by TBlumer — February 27, 2007 @ 12:42 pm