In a move reminiscent of the movie title “Back to the Future,” Alan Greenspan has inked a deal to consult with Allianz’s bond powerhouse, PIMCO, according to a report May 16 in The Wall Street Journal. The relationship with PIMCO, in which, the Journal reports, Greenspan will speak frequently with executives at PIMCO, takes the former Fed chairman back to his pre-Federal Reserve consulting days.
Greenspan had a New York-based economic consulting firm, Townsend, Greenspan & Co., from 1954 to 1987, but dissolved that company when he became Fed Chairman. After leaving the Fed in January 2006, Greenspan formed a consulting firm, Greenspan Associates LLC.
Greenspan’s comments in speeches and meetings still carry weight–some reports pegged Greenspan’s remarks in February 2007, about the potential for recession in the U.S., as one of the factors for the February rout in global equities. The day after Greenspan’s remarks, the DJIA dropped 416 points, the S&P 500 off 3.5% and Chinese stocks in Shanghai were off 8.8%.
Though Greenspan’s remarks are still taken very seriously, he found time last fall at the Schwab IMPACT 2006 conference in Washington D.C., to poke fun at those who used to try to predict which way interest rates would be set, at meetings of the Federal Reserve, by watching how voluminous his briefcase was–it was, he said, simply a matter of whether his wife, NBC News correspondent Andrea Mitchell, had packed his lunch or not.