14-Mar-06: This was considered big news early last week:
"Alan Greenspan, the former chairman of the Federal Reserve, sold his memoirs to Pearson PLC's Penguin Press imprint for more than $8 million, according to those familiar with the situation. The book is expected to be published in fall 2007. We think he is going to write a book that will live for a long time," said Susan Petersen Kennedy, president of Penguin Group (USA). "He lived through an amazing part of history, and he was never able to speak out. He had to be very careful because of his position"
- The Wall Street Journal March 8th, 2006
There's lots of buzz. What will he say? Nothing. Certainly not the whole truth, and certainly nothing to which the State or Federal Reserve System would genuinely object. But the world will probably produce a long line of buyers. Thousands of articles will promote it as containing the secrets of a very great and influential man.
Even gold bugs might buy it to see what, if anything, he "says" about gold or GATA, or what have you.
Who cares. The biggest secrets will remain secrets.
Top 10 Greenspan/Fed Truths that Penguin is NOT Likely to Publish... in no particular order:
- It started out as a surreptitious deal between a bankrupt state and corrupt financial clique - a way to keep them both in business at the expense of taxpayers... and especially of the productive individuals.
- We are indeed the engines of inflation... it all starts with the Fed - never mind the welfare state stuff - I mean we are in business to siphon all your wealth in order to finance bogus big government agendas.
- I couldn't forecast my way out of a maze if I had the map and a guide - indeed, Fedspeak is really just a chimera of contradictory quotes by famous people; but it sure fooled all of you for some of the time, eh?!
- There really is no global savings glut - we made it all up, literally.
- A central bank is an effective monopoly organization; hence by definition it cannot be independent.
- Yes, I confess, our FOMC targeted the stock market too, several times between 1995 and 2005.
- Or, the truth of an unlikely title: Reminiscences of a Counterfeiter!
- We sold the last of our gold a long time ago! Are you kidding? Why did you think it's rising now?
- The statistics on prices and productivity are not just hedonic, they are a total farce! The value of money is really falling much faster than Treasury owners seem to grasp - if it wasn't for the Forex interventions of the Asian central banks during the past few years this fact would not present such a "conundrum."
And now....... for the most unlikely truth to be published by Penguin..............................
- How we brought this dog-gone inflationary fiat monetary standard several steps closer to ruin.
The last one - admitting to deliberately sabotaging the currency - would have made Rand proud. Still, it is the one least likely to be true, at least when it comes to any sort of intent. Thus while he may have done his part in the progression toward less sound money well enough, I would stop short of saying that he led or planned it.
See #3 above, for example. Of course, the biggest secret is really in the message of the deal with Penguin - it is simply that after running a counterfeiting operation for the state for 20 years he gets yet another US$8 million for nothing... something for nothing. Now that's a central banking secret that won't show up in his book.
But what a fantasy it would be for the public to have figured that out by the time it goes to print.
Before moving on to the markets, let me remark that the significance of Ben Bernanke (to gold) is not so much that he is going to change the way the Fed operates... it is that his appointment reflects the changes that have already occurred at the Fed since Volcker... it crystallizes them, and ends the inflation/deflation debate. The answer to every argument that the deflationists have ever proposed is embedded in Bernanke's speeches.
More follows for subscribers...