{"id":2746,"date":"2026-06-23T08:06:35","date_gmt":"2026-06-23T08:06:35","guid":{"rendered":"https:\/\/metrotransitreview.com\/?p=2746"},"modified":"2026-06-23T08:06:35","modified_gmt":"2026-06-23T08:06:35","slug":"alan-greenspan-fueled-americas-boom-and-set-a-course-for-future-prosperity","status":"publish","type":"post","link":"https:\/\/metrotransitreview.com\/?p=2746","title":{"rendered":"Alan Greenspan fueled America’s boom \u2014 and set a course for future prosperity"},"content":{"rendered":"
\n

Alan Greenspan, who died Monday at the age of 100, presided over a two-decade-long period of almost unprecedented American boom and economic dominance that\u2019s now inaptly called \u201cThe Great Moderation.\u201d\u00a0<\/p>\n

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His long tenure as chairman of the Federal Reserve Board offers invaluable economic lessons that today\u2019s Fed would be wise to heed.<\/p>\n

President Ronald Reagan nominated Greenspan as Fed chair in 1987, during his second White House term.\u00a0<\/p>\n

There Greenspan remained until 2006, reappointed by President Bill Clinton and staying through much of George W. Bush\u2019s presidency.<\/p>\n

His tenure followed a period of turbulent and often reckless monetary policy at the Fed.\u00a0<\/p>\n

In the tumultuous 1970s, the Fed tried to juice a floundering economy with easy money, pushing inflation to as high as 11% on the eve of the Reagan presidency.\u00a0<\/p>\n

Family incomes crashed in real terms as Americans\u2019 after-inflation incomes shrank.<\/p>\n

It was the worst decade for the US economy since the Great Depression, sending the stock market into an extended slump.<\/p>\n

Greenspan\u2019s immediate predecessor at the Fed, Paul Volker, is rightly credited with breaking the back of double-digit inflation by taking away the \u201cpunchbowl\u201d of easy money.<\/p>\n

That helped launch a 40-year bull market on Wall Street and rapid gains in American GDP.<\/p>\n

But it was Greenspan who solidified the longer-term victory over inflation, and permanently restored global confidence in the dollar.\u00a0<\/p>\n

During his reign inflation averaged between 2% and 3%.\u00a0<\/p>\n

He operated under the \u201cVolcker rule,\u201d using commodity prices as a forward-looking gauge of inflation to keep prices stable. \u00a0<\/p>\n

And it worked magnificently.\u00a0<\/p>\n

The Reagan expansion that began in late 1982 hit a speed bump with the mini-stock market crash of 1987, but the recovery was swift \u2014 and in the 1990s and early 2000s, the economy shot up like an Elon Musk rocket.\u00a0<\/p>\n

So did the stock market: If you put $100 into S&P 500 stocks when Greenspan arrived, that investment was worth more than $900 on his departure 19 years later.<\/p>\n

So did family incomes: America became a job-creation machine during Greenspan\u2019s tenure, adding roughly 2 million new jobs on average every year.<\/p>\n

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But even as growth exploded, Greenspan was ever vigilant against stock-market bubbles.<\/p>\n

In one of his most famous speeches, he memorably warned investors in 1996 to beware \u201cirrational exuberance,\u201d fearing that stock values may have been getting ahead of themselves.\u00a0<\/p>\n

Yet the market continued to soar as America came to dominate the internet age, with companies like Apple, Amazon and Google leading the charge \u2014 and Greenspan\u2019s low interest rates facilitating the boom.<\/p>\n

Greenspan \u2014 once an avid follower of the famous libertarian Ayn Rand \u2014 wasn\u2019t just an inflation hawk; he also used the Fed\u2019s bully pulpit to browbeat Congress into cutting deficit spending.\u00a0<\/p>\n

It\u2019s no accident that the only balanced budgets in the last 50 years happened when Greenspan was at the helm of the Fed.\u00a0 \u00a0<\/p>\n

That\u2019s the lesson of the Greenspan era:\u00a0Combine stable prices, lower tax rates, and less regulation with restraints on government spending, and you\u2019ve got the secret sauce for a prosperous America.\u00a0<\/p>\n

The dollar became the unrivaled world reserve currency in the 1990s, and other nations effectively \u201cdollarized\u201d their own currencies to defeat the curse and theft of runaway inflation.\u00a0<\/p>\n

One of the nations that wisely dollarized was China, during its rapid ascent after shifting away from a wholly communist economy toward a market-oriented one.\u00a0<\/p>\n

Inflation remained low until in 2022 Fed chief Jerome Powell allowed prices to flare up to above 9% during Joe Biden\u2019s presidency.\u00a0 \u00a0<\/p>\n

\n<\/div>\n

It\u2019s ironic that many economic historians have begun to call the Greenspan era \u201cThe Great Moderation\u201d\u00a0 \u2014 because all that was really \u201cmoderate\u201d during this era was inflation.\u00a0<\/p>\n

In fact, it was the \u201cGreat American Boom,\u201d under principles that President Donald Trump is restoring.<\/p>\n

Kevin Warsh, the new Fed chair, appears to be a disciple of Volcker and Greenspan, continually touting the policy of a stable dollar.\u00a0<\/p>\n

If he follows their example, more prosperity is right around the corner.\u00a0<\/p>\n

Stephen Moore is a co-founder of Unleash Prosperity who served as an economist in Ronald Reagan\u2019s and Donald Trump\u2019s administrations.\u00a0\u00a0<\/em><\/p>\n

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Alan Greenspan oversaw the \u201cGreat American Boom,\u201d under principles that \u00a0President Donald Trump is restoring.<\/p>\n","protected":false},"author":1,"featured_media":2745,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[],"class_list":["post-2746","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-opinion"],"yoast_head":"\nAlan Greenspan fueled America's boom \u2014 and set a course for future prosperity - Metro Transit Review<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/metrotransitreview.com\/?p=2746\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Alan Greenspan fueled America's boom \u2014 and set a course for future prosperity - 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