Since Alan Greenspan became chairman of the FED, the country's economy has reflected many
positive results. He has done a terrific job. Allan is a very bright man who is always
thinking of ways to prevent problems before they happen in the economic sector of the
nation. All economists have been very content with his job just until now. In a recent
Time magazine article called Is That Really You, Allan?disapproval about some new rules
that this man has suggested for the economy have been highly critized.
The first new rule that Alan proposed was to keep down with producivity. In the article he
responds to this new rule by saying that too much efficiency pushes demand and becomes
inflationary. This meaning that too much is produced and stock prices are getting higher.
When this happens people begin to feel very wealthy and start to buy and buy like crazy.
This is something that can cause major inflation in a future. Alan's second rule is to
keep stock market prices not rising more than 5% to 6%. Greenspan comments that this has
to be done because shares should rise only as fast as the rest of the economy.
These two new rules proposed by Alan are mainly to protect the country from inflation and
many economists and other people don't understand it. The article also reflects that many