Former Federal Reserve Chairman Alan Greenspan is again talking about matters of importance to the financial markets. He expressed concerns about the problems in the subprime market, and in response, equity prices fell. They have since recovered.
I feel that Greenspan is entitled to his opinion, and given his age and many years of public service, I believe he is entitled to profit from his opinion. Greenspan is no longer involved in policymaking, and he has no special responsibility to stay quiet except when his views reflect information that the public cannot obtain on its own.
As Fed chairman, Greenspan was privy to intelligence from the field, obtained through the boards of directors of the Federal Reserve's twelve district banks. Greenspan no longer has this access, so when he delivers an opinion it is "clean," and more his own than ever before.
I noticed the other day in the Financial Times that Greenspan was at a function wearing a very snazzy tie -- a bright red tie with large polka dots, made of rich-looking silk. The tie looked uncharacteristic of the normally conservative-looking Greenspan, and I have never seen a snazzier looking tie on him. It's about time he had a chance to spend a few extra dollars.
P.S. Will you be there when Cramer makes his next move?
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Tony Crescenzi is the chief bond market strategist at Miller Tabak + Co., LLC, and advises many of the nation's top institutional investors on issues related to the bond market, the economy and other macro-related issues. At the request of the Federal Reserve, Crescenzi is a regular participant in the board's Livingston Survey of economic forecasters. He is also the author of the revised investment classic, The Money Market,
first published in 1978 by Marcia Stigum, and The Strategic Bond Investor. At the time of publication, Crescenzi or Miller Tabak had no positions in the securities mentioned in this column, although holdings can change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Crescenzi also is the founder of Bondtalk.com, a popular Web site covering the bond market and the economy. Crescenzi appreciates your feedback; click here to send him an email.
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