The guy in question was Nobel laureate Milton Friedman, and he died a few months ago. He was famous for many things, among them for arguing that the Great Depression was primarily caused by the disastrous policy of the Fed at the time (the Fed sharply raised rates as markets tanked!). Friedman compared the 1930s depression, the Japanese crash of the 1990s, and the US stock crash of 2000-2002, and concluded that the vast differences in outcome were primarily due to central bank policies. From catastrophic (1930s Fed raised rates) to so-so (1990s Japanese central bank lowered, but not fast enough) to brilliant (2000s Fed slashed rates to 1% extremely fast, resulting in only a mild recession). Now, I know that Greenspan & Co don’t have many friends on this board, but I believe they did the right thing, and we dodged a very big bullet. True, they probably kept the rates low for a year or so too long (they should have started raising in mid-2003), but hindsight is 20/20.
