25 Year Later, Thoughts On Alan Greenspan & 'Exuberance'

On December 5, 1996, Alan Greenspan, then chairman of the Federal Reserve, gave one of his most memorable speeches, “The Challenge of Central Banking in a Democratic Society.” In that speech, given while accepting the Francis Boyer Award from the American Enterprise Institute (AEI), he coined the term “irrational exuberance.” Greenspan asked, “How do we know when irrational exuberance has unduly escalated asset values, which then become subject to unexpected and prolonged contractions … ? And how do we factor that assessment into monetary policy?” Read Full Article »