I was reading about how shocked Greenspan is at the global financial cancer that developed during his leadership of the world economy. Now the worse part of this is that I believe him. The problem with conspiracy theories against the Bush administration is that they fail to explain why would anyone in the Bush administration would want America to collapse the way it did and drag the world along with it.

This was not a conspiracy. This was just incompetence. A blind belief in markets. A conviction that if government just got out of the picture everything would self adjust in the end. The result? Bush established socialist America, in which the US government is the largest home owner and bank owner in the world.

The only good news is that if this had to be done, I am very pleased that Obama will come to power after this disaster. If Obama had had to start his presidency nationalizing everything he would have been accused of being a communist.

Now one current development that is very unfair is that even though the current crisis is the result of USA mismanagement and at the beginning US markets were affected more than others, currently the dollar is king and foreign markets are down more than USA. And this is when the rest of the world saved and USA squandered.

Follow Martin Varsavsky on Twitter: twitter.com/martinvars

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Jac on October 24, 2008  · 

Agree with you on all.
My view on the dollar is that we have an “imperial world” where the US are, for the moment, the rulers so everybody complies because they fear they will have much more to lose…
But it looks like that the end of the US empire is approaching… China will take the leadership, but when ?

As I do not, yet, speak chinese I hope it will take at least 50 years 😉

3.0 rating

Marc Arza on October 24, 2008  · 

I can’t see how could Mr. Greenspan be suprised by this situation. All he had to do in order to see the mess he was getting us into was look west and take a look at Japan’s experience with the 80’s bubble and the 90’s burst!

We were so afraid of a recession, even of a small one, that we dodged the .com crisis and 9/11 with lower interest rates, ignoring the enormous trouble we were getting into.

Now, as we try to avoid this recession by pouring pulic money into the markets, we are again missing the point while getting into an even bigger mess.

Un saludo,
Mark Arza

3.0 rating

Rafa Garcia on October 24, 2008  · 

@jac: When?. Years ago.

3.0 rating

polac on October 24, 2008  · 

One country leadership should be over in XXI century, and that’s what’s going on, I hope it will be a peacefully transition to the new world’s order. Its a hard job, but a think it is ridiculous to blame Mr Greenspan, he left the machine in perfect function state to Mr. Bernanke and Mr Paulson.

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Diego A on October 24, 2008  · 

mmm not sure if the machine was in perfect condition… The machine had maintenance under Greenspan and every time missed the piece that would collapse the financial system.
I believe the dollar is still that strong due to belief. Nobody really believes in any other currency that much in order to move all its assets, and eventhough this is by far the worst crisis in a long time, the country will recover… The empire might bend, but won’t crack.

3.0 rating

Lasse Enersen on October 25, 2008  · 

Free market flows according to the whims of government creatures Fed, Fannie Mae and Freddie Mac.

Problem is not free market and lack of regulation. Problem is tampering with free market with artificially low interest rates and having government backing up Fannie and Freddie, and thus taking away the one ingredient that makes capitalism work: risk.

I don’t blame the government for creating this mess on purpose. I blame the for being stupid and economically illeterate.

3.0 rating

Dave Thomas on October 25, 2008  · 

Sell FON and leave your political views at the door. I used to enjoy your blog until you became a political zealot. You think Obama is gonna save the world? You’re nuts.

3.0 rating

Martin Varsavsky on October 25, 2008  · 

Dave Thomas,

The whole point of having a personal blog is to write my own views. If they disturb you, please do not return.

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