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Alan Greenspan: prophet and loss

With Greenspan and the economy, a lot of knowledge proved to be a dangerous thing

By Martin Sandbu   December 2016

Mark Wilson/Getty Images

The Man Who Knew: The Life and Times of Alan Greenspan by Sebastian Mallaby (Bloomsbury, £30) 

In retrospect, it is easy to see what happened. The 2008 crisis was triggered by the mother of all bank runs: a panicky loss of confidence in the financial system, which had loaded up on lousy mortgages that remained unsafe even though they were wrapped up in new and exotic ways. Financial institutions had made too many loss-making investments, but the bubble they had inflated delayed…

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