Alan Greenspan, the former Federal Reserve chairman who presided over nearly two decades of U.S. economic growth and was later blamed for policies that led to the 2008 financial crisis, has died at age 100. His wife, NBC News correspondent Andrea Mitchell, announced that he died from complications of Parkinson's disease. Greenspan served as Fed chair from 1987 to 2006 under four presidents, shaping monetary policy through booms, busts, and crises.
From clarinet to central banking
Born in New York City on March 6, 1926, Greenspan was raised by his mother and initially pursued music, studying clarinet at Juilliard and playing in a band with jazz saxophonist Stan Getz. While touring with the Henry Jerome Band, he taught himself economics and managed the group's accounts. At 19, he enrolled at New York University, becoming a free-market disciple, and later worked as an economic consultant and served on the board of JP Morgan.
Greenspan's encounter with novelist Ayn Rand in 1952 deeply influenced his belief in unfettered capitalism. He called the welfare state a mechanism for government confiscation of wealth. After predicting the Eisenhower recession, he advised Richard Nixon's 1968 campaign and later headed the Council of Economic Advisers. Presidents Gerald Ford and Ronald Reagan also tapped him for economic roles, and Reagan appointed him Fed chairman in August 1987.
Steering the economy through crises
Days into his tenure, the October 1987 stock market crash wiped out over 30% of share values. Greenspan's swift reassurance and cheap credit stabilized markets, a playbook he repeated during the savings and loan crisis, the Gulf War, and the Mexican peso crisis. His approach later became known as quantitative easing. Under his watch, the 1990s saw a golden era of growth, and he praised Bill Clinton's "consistent, disciplined focus on long-term economic growth."
Greenspan was renominated by George H.W. Bush and later by Clinton, serving five unprecedented terms. He cut interest rates after the 1997 Asian financial crisis and the 2000 dot-com bust, which he had earlier called "irrational exuberance." After 9/11, he slashed rates to support the economy and urged President George W. Bush to remove Saddam Hussein over energy market fears.
Legacy of low rates and deregulation
Critics argue Greenspan's low interest rate policies fueled the dot-com bubble and, after 9/11, inflated the housing market. His aversion to bank regulation allowed risky derivatives trading to flourish, contributing to the 2008 subprime mortgage crisis. In October 2008, Greenspan admitted to Congress that he had found a "flaw" in his free-market beliefs, acknowledging banks had proven his self-regulation theory wrong. The Federal Reserve said Monday that Greenspan "brought rigorous analytical discipline to monetary policymaking" and that his legacy endures through the economists he mentored.