For the world of central banking, the twentieth century ended with the retirement of Alan Greenspan from the chairmanship of the Federal Reserve Board on 31 January 2006. At the time, Greenspan was widely believed to have been one of the most successful central bankers ever. Even Milton Friedman, a long-standing critic both of the Fed and of discretionary monetary policy, extolled Greenspan's deft monetary management in the 1990s (Nelson, E. 2007b). The Greenspan years witnessed several close misses with financial meltdown, including the 1987 stock market crash, emerging market crises in Asia, Latin America, and Russia, the Long-Term Capital Management (LTCM) fiasco in 1998, the dotcom implosion in the early 2000s, and the attacks on 11 September. Greenspan, the great helmsman, was credited with steering the ship away from the rocks each time. The praise heaped on him by many commentators, including academics (Kahn 2005), was also an endorsement of the central banking profession, which seemed to have triumphed over inflation, and appeared to be on the verge of implementing more effective techniques for averting and containing financial crises through Basel II.

With the onset of the first major financial and economic crisis of the twenty-first century in 2007–9 (Bordo 2008), the standard interpretation of recent financial history was brought into question.