In early December Federal Reserve Chairman Alan Greenspan spoke about a material slowing in the rate...
In early December Federal Reserve Chairman Alan Greenspan spoke about a material slowing in the rate of growth in the US economy, and the stock market went into wild euphoria. There is a lesson here about the importance of people's expectations for the actions of public policy makers such as Greenspan. A few years ago, I shared an early morning ride to the airport with a friend who is a well-known academic economist. In the course of the trip, my pager started beeping with the announcement of blowout government statistics on non-farm payrolls: bigger employment growth than anyone expected....
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