Forget about the presidency, Federal Reserve Board Chairman Alan Greenspan proved on Tuesday that he is the world’s most influential person, at least as far as stock markets an economic activity are concerned.

Greenspan told a banking conference in New York that the Fed would reduce interest rates if needed to ward off a recession.

Investors responded with a buying frenzy that sent the Nasdaq composite up 274 points, or 10.5%, the largest gain in its history.

The Dow Jones Industrial Average also surged 339 points, or 3.2%, on Tuesday.

The next Fed meeting is Dec. 19.

The Fed raised interest rates six times in late 1999 and early 2000 because it was worried that the pace of economic growth was unsustainable and that inflation would accelerate as a result.

It has not raised rates since May, but the Fed has said in recent months that it was more worried about inflation than the economy cooling off too much.

But on Tuesday, Greenspan said new data suggests consumer demand has declined sharply, jeopardizing the possibility of a soft landing for the economy that he hoped to orchestrate.

One piece of new evidence indicating that the economy could lapse into recession is the 3.3% decline in factory orders in October. The October decline was the first in three months, and the impact was felt the most by manufacturers of transportation products and electronics, according to the U.S. Department of Commerce.