Greenspan's last day on the job is today. There are loads of articles about his leaving and that affect on the market, but I thought I would share some facts about the man, courtesy of one of my favorite mortgage brokers, Bobbi Clemens.
LONG TIME ON THE JOB - Alan Greenspan is the 13th chairman of the Federal Reserve, having taken over for Paul Volcker on 8/11/87. When Greenspan retires, he will have served as chairman for 222 months, the 2nd longest tenure of any chairman in the 93-year history of the Fed
TIME TO SLOW DOWN - Greenspan will be 80 years old on 3/06/06, or just 6 weeks from today. On the day Greenspan becomes an octogenarian, basketball star Shaquille O'Neal turns 34 years old. Greenspan's father was a stockbroker and his mother worked in retailing in NYC.
INITIATION BY FIRE - Just 10 weeks after Greenspan became chairman on 8/11/87, the US stock market suffered its worst 1-day percentage loss in history. The 20% decline of the S&P 500 on 10/19/87 forced Greenspan to coordinate the flow of funds needed to maintain liquidity in the financial markets.
CLASSY GUY - Greenspan studied at the Juilliard School of Music in NYC for 2 years in the 1940s. He played the jazz clarinet and traveled the country for 1 year with the Henry Jerome swing band.
UNDERPAID - Alan Greenspan was paid $174,500 in salary over his last year on the job.
LOVE THOSE MITCHELL GIRLS - Greenspan was married twice in his life and each of the 2 women had the same last name. He married artist Joan Mitchell in 1952 and then later married NBC news reporter Andrea Mitchell in 1997. He also dated Barbara Walters in the 70's.
HE SAID WHAT? - 4 famous phrases spoken by Alan Greenspan were 1) his 12/05/96 speech where he used the term "irrational exuberance" to describe the bullish performance of the US stock market; 2) his 2/16/05 description of the behavior of the world bond market as being a "conundrum"; 3) his 7/20/05 speech before a House committee when he acknowledged that there were "signs of froth" in certain real estate markets; and finally 4) an undated speech in which he is quoted as saying "I worry incessantly that I might be too clear" (source: Federal Reserve, Bloomberg News, Barron's).
ON HIS WATCH - During Alan Greenspan's 18 1/2 years as Fed Chairman, the S&P 500 has advanced +492% on a total return basis, equal to +10.1% compounded per year. The S&P 500 was up 15 of the 19 years (1987-2005) during his time in office. Additionally, the US economy has grown at an annual rate of +3.1% while inflation has gone up by a nearly equivalent +3.0% per year.
HE RULES - 29 of the last 32 votes taken (2002-05) by the 12-member Federal Open Market Committee have been unanimous votes supporting the position taken by Greenspan (i.e., either to lower, raise or maintain short-term interest rates). The last dissenting vote was cast by Mark Olsen on 9/20/05.
EVALUATING THE ECONOMY - The US suffered 2 recessions in Greenspan's 18 1/2 years as Fed Chairman. The country also flourished from 3/91 to 3/01, producing a 10-year period of economic expansion, the longest in our country's history
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