Remembering Alan Greenspan

Editor's Note: This column was part of the June 25 Pulse sent to nearly 13,500 subscribers.Weeks after being sworn in as Chair of the Federal Reserve, Alan Greenspan was on a plane to Dallas from Washington, D.C. to address the annual convention of the American Bankers Association. It was early in the morning on Monday, Oct. 19, 1987. It was a big day for Mark W. Olson, who worked at the Security State Bank in Fergus Falls, Minn., the community bank his father founded. .Olson was in Dallas, completing his one-year term as president of the ABA. At 44 years old, he was the youngest president in ABA history. Olson was a little nervous as he was scheduled to introduce Greenspan at the convention’s opening general session. It was to be Greenspan’s first major address to an industry audience since being sworn into office on Aug. 11. Immediately upon landing, Greenspan checked the markets and when he got the news that the Dow Jones was on its way to its biggest-ever single-day decline, he got right back on the plane and returned to Washington. Greenspan immersed himself in the first economic crisis of his chairmanship, and Olson never got to make his introduction. Greenspan and Olson, however, would reconnect 14 years later when Olson was sworn in as a Federal Reserve Board Governor on Dec. 7, 2001. He served until June 30, 2006, five months after Greenspan concluded his 18 years as the Fed’s 13th chair. During his remarkable tenure, Greenspan often spoke at industry conventions, and it was always a highlight to listen to his monotone speeches, even if we weren’t always clear about what he was trying to say. I remember in the year 2000, he spoke at the annual convention of the Independent Community Bankers of America, which was in San Antonio that year. Among his themes was an explanation of why it made sense for Fed supervision to be adjusted according to the size of the institution. Greenspan, in my opinion, was more focused on monetary policy than on regulatory policy, but he was right about the concept which is now commonly called tailoring, and continues to be championed by members of the Fed Board, most notably by Michelle Bowman. I can’t believe it’s been 20 years since Greenspan was Chairman. He died on Monday at the age of 100. Students of economics and American history will be studying the Greenspan Fed for centuries to come. What an honor that I got to see much of it first hand during the first half of my career.