Alan Greenspan is dead. The man who defined American monetary policy for two decades died this morning at his home in Washington. He was 100.
The City of London is already issuing statements. Tribute. Respect. The usual choreography. But behind the protocol, there is genuine unease. Greenspan was the last giant of a certain kind of economics. The kind that trusted markets. The kind that believed in the magic of interest rates.
He was chairman of the Federal Reserve from 1987 to 2006. Four presidents. From Reagan to George W. Bush. He was the Maestro. The term stuck. He conducted the global economy with a briefcase and a phrase. 'Irrational exuberance'. He coined it in 1996. He meant the stock market. But it applied to everything.
He was not a politician. He was an economist. A libertarian leaning one. He worshipped Ayn Rand. But in office, he was pragmatic. He slashed rates after Black Monday in 1987. He kept them low after 9/11. He fought inflation with a surgeon's precision. Or so we thought.
The 2008 crash tarnished his legacy. Critics said he kept rates too low for too long. They said he enabled the housing bubble. He admitted mistakes. But the damage was done. He became a figure of blame for the left. A symbol of deregulation.
Yet the City remembers him differently. Here, he is the man who made London a financial capital. His loose monetary policy in the early 2000s flooded the City with cheap money. The banks grew fat. The bonuses swelled. The Square Mile owes him a debt. And that is why the tributes will be effusive.
Chancellor of the Exchequer Rachel Reeves called him 'a titan of economic thought.' The Governor of the Bank of Andrew Bailey said his 'intellectual rigour shaped central banking for generations.' The true reactions will be whispered in the wine bars of St. James's. Mixed. Respect for his craft. Resentment for his legacy.
His death closes a chapter. He was the last of the great central bankers who were treated like rock stars. Before the job became political. Before the Fed became a target for populists. Before interest rates became a culture war.
The immediate question: what does this mean for markets? Probably nothing. The era of Greenspan is long over. But the city will pause. Traders will raise a glass. Then they will get back to work.
Greenspan's life was a lesson in the arc of power. He started as a saxophone player. He ended as the second most powerful man in America. He married NBC journalist Andrea Mitchell. He was a fixture of Washington dinner parties. He was courted by presidents. And now he is gone.
The funeral will be in New York. The eulogies will be written by economists. But the real monument is the global financial system. Flawed. Complex. Built on his ideas.
In the City, they know this. They will mourn. But they will also wonder: who is the next Maestro? Nobody. That's the truth. The era of the master central banker is over. Greenspan's death marks its final note.
