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Alan Greenspan's much anticipated book "The Age of Turbulence" hits the book shelves today, and his shocking predictions and thoughts about the state of the economy and interest rates are all over the business news today.

Greenspan has plenty of predicitions inside his new book that he is explaining to the press in his recent interviews, and most of the predictions are not very positive for the economy. In a recent interview, Greenspan is quoted as saying that the disinflationary backdrop of his days at the Fed are leaving and that inflationary pressures will likely be a huge problem going forward. Mr. Greenspan even goes as far as to predict that the 10 year treasury yield will likely hit 8% or higher in the next 20 years. A predicition for this large of a move in the treasury yield is a true shock to economists and investors alike.

Greenspan says that he believes that the rise in the prices of Chinese imports into the United States, the new highs in oil, and the decreasing effect of globalization will cause major inflationary pressures on the U.S. economy. He believes that policymakers will likely be forced to end up raising interest rates to very high levels of 10% or higher in the future in order to fight significant inflationary pressures.

Given the importance of tommorrow's FOMC monetary policy statement, Greenspan beating the drum on inflationary pressures is sure to make some investors uneasy.

I must say I'm rather surprised that Greenspan is taking such a public stance on his predictions for the economy and monetary policy at this point. Greenspan has in the past been quoted as saying he understands the importance of future Fed chairmen such as he to stay away from current monetary policy discussions so as not to effect the current policymaking board and its decisions. As of now, Greenspan is not listening to his own advice. These very public predictions and thoughts are clearly part of a public relations move to try to sell his book. My hope is though, after the initial publicity moves that Greenspan will allow Mr. Bernanke to do his job as it relates to monetary policy.

Greenspan could be right about inflation and the future of interest rates, or he could be wrong about them. Greenspan has had his day as Chief of the Fed though, and in the future I hope he is able to allow the current Fed Chairman to decide where interest rates should go and how to best help the U.S. economy going forward.

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