In spite of my other posts, I'm pretty skeptical of the importance of monetary policy. For starters, it seems like a misnomer, since there's no particularly good reason to believe that the money multiplier is reliable. That is, it seems like monetary policy is based on an exogenous theory of money, while in reality it seems more likely that lending is driven by demand at a particular interest rate -- and while the Fed can set the interest rate, it can't set demand, and in that sense the causality of the money multiplier may very well go the other direction.

But even if money is exogenous and monetary policy works, it's presumably even less relevant to asset bubbles, because the interest rate of a loan only matters if you plan on holding it. If the plan is to buy a house and flip it, thus extinguishing the loan quickly, then the rate of the loan doesn't matter.

If there's any way in which Greenspan (or the Fed generally) was important, it was that it's supposed to be a regulator for the banking system, and it totally dropped the ball.