US Federal Reserve chairman Ben Bernanke

There is a certain sense of deja vu watching US Federal Reserve chairman Ben Bernanke pump more liquidity into the US market to try and keep it afloat.In his damning book, Greenspan's Bubbles, William Fleckenstein accuses his predecessor of blowing two asset bubbles. He says that the subprime mortgage crisis is Greenspan's legacy."Greenspan bailed out the world's largest equity bubble with the world's largest real estate bubble. That combination easily equates to the biggest orgy of speculation and debt creation in the United States (and the world) has ever seen. Unfortunately, Greenspan's legacy will not just be those two bubbles, their attendant busts, and the trillions of dollars of debt left in their wake. Operation Enduring Bubble - what I call Greenspan's monetary and interest rate decisions that created the real estate bubble also exacted a heavy toll on the dollar.''Greenspan, according to Fleckenstein, routinely suppressed the forces of creative destruction that come with every market. By slashing interest rates and keeping them low for too long, and by pumping in money, he ensured there was a loss of fear which meant that the normal risk reduction response that most business people have to periodic pain never occurred. It left the US swimming in an ocean of debt that has been ratcheting higher.According to Fleckenstein, Greenspan couldn't see the tech bubble because he was mesmerized by the facade of a technology-driven productivity boom, resulting in a continual cheerleading that encouraged others to make wrong-headed economic and investment decisions.