Whenever the economy comes crashing down, journalists try to figure out what went wrong, and their first target is frequently each other. Two weeks ago, The New York Times ran a devastating piece about CNBC's popular pundit Jim Cramer, who'd been a relentless cheerleader for Wall Street in the run-up to the financial collapse. Gawker filleted Fortune for saying in December that AIG was one of the 10 best stocks to buy now. But one person who has come out of the meltdown smelling like a rose is William Greider, the cranky (but only in print!) 72-year-old columnist for The Nation, who has been predicting the apocalypse for practically half a decade. It's a subject he has known a lot about since 1989, when he published "Secrets of the Temple," considered by many to be the definitive book about the Federal Reserve (and certainly one of the most critical). Here, Greider talks about the Fed, presidents and economic malaise.
WWD: In August 2007, you wrote that "the country's economic well-being is held hostage by the 'modern' financial system, with its fallible computer models and extreme oscillations between excess and panic. Our dependence started with fi nancial deregulation 25 years ago, but the dangers have grown steadily larger, still unaddressed by the political system." What so concerned you that caused you to sound the alarm?
William Greider: Well, the housing thing was coming unwound then. In the spring and into the summer, you could see that the bubble had popped. And if you understood the fl aws, the kind of gross dereliction of the Federal Reserve and other regulators, going back some time, you understood that they were creating false prosperities, refl ected not in the real economy of producers with the workers, but in the fi nancial system. And that became this great talisman for prosperity.