Recession will be worst since 1930s -Greenspan (architect of current economic crisis)

[UpInArms]

Source: Reuters

NEW YORK, Feb 17 (Reuters) - Former U.S. Federal Reserve Chairman Alan Greenspan said on Tuesday the current global recession will "surely be the longest and deepest" since the 1930s and more government rescue funds are needed to stabilize the U.S. financial system.

"To stabilize the American banking system and restore normal lending, additional TARP funds will be required," Greenspan said in a speech to the Economic Club of New York. The U.S. Treasury's Troubled Asset Relief Program designed to help bail out banks has been partially successful, he said.

Despite his prognosis on the current downturn, Greenspan said the pace of economic deterioration "cannot persist indefinitely."

He reiterated, however, that a housing recovery is a necessary condition for the end of the financial crisis, and said that "the prospect of stable home prices remains many months in the future."

<snip>

Greenspan, a proponent of self-regulation, said he was "deeply dismayed" when in August 2007 the premise that firms had the enlightened self interest to monitor their own risk exposure "failed."

Read more: http://www.reuters.com/article/bondsNews/idUSN1739846320090218?sp=true

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Greenspan goosed the housing market:

http://www.federalreserve.gov/boarddocs/speeches/2004/20040223/default.htm

Remarks by Chairman Alan Greenspan
Understanding household debt obligations
At the Credit Union National Association 2004 Governmental Affairs Conference, Washington, D.C.
February 23, 2004


Introduction: Credit Unions and Consumer Lending
Credit unions have long focused on the needs of their members. Traditionally, the industry has specialized in personal and automobile loans, and the bulk of lending at many credit unions remains concentrated on these types of loans. In the past decade, however, many of you have become more involved in first- and second-lien mortgage loans. With lending efforts focused on consumer and residential mortgage loans, credit unions have a natural interest in the financial health of America's households.

We have a similar interest at the Federal Reserve. Consumer spending accounts for more than two-thirds of gross domestic product, and residential investment--the construction of new homes--makes up another 4 percent or so of GDP. In addition, households own more than $14 trillion in real estate assets, almost twice the amount they own in mutual funds and directly hold in stocks. Over the past two years, significant increases in the value of real estate assets have, for some households, mitigated stock market losses and supported consumption.

...more...

and turned a blind eye to regulating hedge funds

http://blogs.wsj.com/economics/2007/09/23/greenspan-slams-ratings-agencies/

September 23, 2007, 12:59 pm
Greenspan Slams Ratings Agencies

In an interview with Sunday’s Frankfurter Allgemeine Zeitung, one of Germany’s most prominent newspapers, former Federal Reserve Chairman Alan Greenspan sharply criticized ratings agencies for their role in the current credit crisis. “People believed they knew what they were doing,” Mr. Greenspan says in today’s FAZ. “And they don’t.”

Still, he doesn’t think it’s necessary to strengthen rating-agency regulation. Essentially, they’re “already regulated,” he says, because investors’ loss of trust means the agencies are likely to lose business. “There’s no point regulating this. The horse is out of the barn, as we like to say.” Greenspan also said he believes that the volume of structured-finance products will decrease. “What kept them in place is a belief on the part of those who invested in that, that they were properly priced. Now everyone knows that they weren’t. And they know that they can’t really be properly priced,” said Greenspan.

In the article, Greenspan also refutes critics who say the Fed kept rates too low for too long after Sept 11 and therefore contributed to the U.S. real-estate bubble. Rather, he holds the general, worldwide decline in long-term interest rates — which he says the Fed had no tools to combat — responsible: “The central bank in this country is no match for bull markets that have developed in the last generation.”

Greenspan predicts there’s likely to be a further sharp fall in U.S. house prices, which should dampen consumption: “As a consequence, that will affect consumer spending, because … a substantial part of consumer spending does not come directly out of income, but out of assets, finance by debt.”

Finally, Greenspan said he’s against hedge-fund regulation. “Hedge funds are a very important plus,” because they increase the market’s flexibility and resilience, Greenspan told the FAZ. While he reckons there may be more hedge-fund collapses, he doesn’t see that as a threat to the financial system and cites Amaranth’s limited impact as an example. Plus, he says, it’s practically impossible to regulate hedge funds anyway. “One of the problems with hedge funds is that they are changing so rapidly,” he says. “If you have the balance sheet that closed business last night, by 11 a.m. this morning, that won’t tell you very much about what they’re doing.”

...more...

this one-man walking timebomb POS needs to STFU and worry about when the guys with the white jackets and sleeves that tie in the back are coming to take him away

[CatholicEdHead]

1. He seems to be a bit behind the times

I only watched a few minutes of his speech on CNBC tonight.

[snappyturtle]

2. Personally, I think Greenspan should be hauled to prison. He aided

and abetted the theft. No one will ever convince me he didn't know what he was doing.

[goclark]

5. Let the door hit him on his old bottom and take his wife Andrea

Mitchell with him.

She needs to wear a name tag with her real name on it every day.

She is constantly "forgetting" to let us know that her damn husband knew exactly what we were getting into. :puke:

[OhioChick]

9. They're husband and wife????

I never knew and am shocked....to an extent.

[UpInArms]

12. Alan Greenspan, Andrea Mitchell

http://query.nytimes.com/gst/fullpage.html?res=9A01E0DE133DF935A35757C0A961958260

Published: April 6, 1997

Andrea Mitchell, the NBC News correspondent, is to be married today to Alan Greenspan, the chairman of the Federal Reserve Board. Associate Justice Ruth Bader Ginsburg of the Supreme Court will officiate at the Inn at Little Washington in Washington, Va.

The bride, 50, is the television network's chief foreign-affairs correspondent, based in Washington. Ms. Mitchell, who is keeping her name, has also covered the White House, Congress and national political campaigns for NBC. She graduated from the University of Pennsylvania, where she is a trustee.

She is the daughter of Cecile and Sydney Mitchell of New York. Her father, now retired, was a founder and the chief operating officer of the Loroman Company, a furniture manufacturer in Manhattan. He was the president of Beth El Synagogue in New Rochelle, N.Y., from 1952 to 1992. Her mother, also retired, was an administrator at the New York Institute of Technology in Manhattan.

The bridegroom, 71, has been the Federal Reserve chairman since 1987. He was the chairman of the Council of Economic Advisers in the Ford Administration and the chairman of the National Commission on Social Security Reform in 1982 and 1983. From 1954 to 1974 and from 1977 to 1987, he was the chairman and president of Townsend-Greenspan & Company, a New York economic consulting concern. He graduated from New York University, from which he also received master's and Ph.D. degrees in economics. He also studied at the Juilliard School and plays the clarinet and saxophone.

...a bit more that omits he's an Ann Randian eCONomist...

[OhioChick]

13. Thanks....

I looked it up...didn't believe it, at first. :wow:

[ronnie624]

23. A conflict of interests in 'news reporting' like few others. n/t

[UpInArms]

6. he was a butt-lickin republican first and before anything else

http://www.cfr.org/publication/14280/charm_of_the_chairman.html?breadcrumb=%2Fbios%2F4452%2F%3Fgroupby%3D2%26hide%3D1%26id%3D4452%26page%3D1

If Greenspan’s networking skills helped to land him the Fed job, they also colored the way that he performed in it. Volcker had made a point of keeping his distance from the executive branch, fearing that friendliness would cause the markets to doubt his toughness on inflation. Greenspan’s approach was the opposite. Whereas Volcker refused to visit Reagan at the White House, and refused to have Reagan visit the Federal Reserve, Greenspan loved access. He flew down to Little Rock to meet Bill Clinton during the transition. He spent hours talking to incoming Vice President Cheney in the Cheney family kitchen. Even after that relationship had soured, Greenspan visited the Bush White House weekly.

Greenspan’s role as the enabler of the Bush tax cuts has damaged his legacy. Yet it’s remarkable how little this and other political entanglements compromised the Fed’s independence in setting interest rates. Back in the 1980s, Volcker’s admirers might have predicted that Greenspan’s penchant for schmoozing senior officials and taking a position on every economic issue of the day would undermine the technocratic character of the Fed. But Greenspan was perfectly capable of socializing with Nick Brady, the Treasury secretary in the first Bush administration, while brushing off Brady’s bullying demands for lower interest rates. If anything, Greenspan’s status as an insider-guru on all economic questions served to enhance the Fed’s prestige, upending the standard assumptions about central banks that prevailed before he tore up the rule book.

The enduring criticism of Greenspan’s monetary record has turned out to be a different one. As the economy boomed during the 1990s, Greenspan was early in seeing the productivity revolution in U.S. firms that would allow the economy to zoom ahead without inflation. In September 1996, he took the risk of keeping interest rates low, rightly predicting that prices would remain stable. But while easy money cleared the way for the long boom of the 1990s, it had a darker consequence: It fueled the growth of a stock-market bubble that led the economy astray, misallocating billions of dollars of savings to worthless dot-com fantasies. In predicting that inflation would stay dormant, Greenspan correctly anticipated that the price of eggs would stay stable. But nest eggs were going through the roof. The real inflation was in stock prices.

Hence the anti-Greenspan rap: He was complacent about market bubbles. It is a complaint that seems especially damning now, as the second Greenspan bubble — this time in real estate — is popping up all around us. But on this issue, unlike on the Bush tax cut, Greenspan sketches a reasonable defense of his record.

[daggahead]

16. He his also a follower of Ayn Rand ...

You need to read Greenspan's Fraud, by Dr. Ravi Batra.

[MisterP]

19. the man was briefly (ha!) Ayn Rand's panties: of course he's an idiot n/t

[rollingrock]

3. More fearmongering and scare tactics

the banksters will say and do anything to swindle us out of even more of our tax dollars.

shameless crooks.

[Autumn]

4. For fucks sake

give those assholes every thing we have. After all they shouldn't have to suffer because of their choices.:mad:

[MadMaddie]

7. The New Administration should have a conversation with

Greenspan because even though he has not held that position for years, what he says still impacts the world economy.

[av8rdave]

8. Let's see if I've got this straight:

From this article alone:

"Still, he doesn’t think it’s necessary to strengthen rating-agency regulation."

"Finally, Greenspan said he’s against hedge-fund regulation."

Wholesale deregulation and elimination of many of the protections put in place during the last depression, and he is "dismayed" that the financial community didn't regulate itself.

What is truly amazing is that there are still people who believe he's the smartest guy in the room!

[UpInArms]

10. there are laws in place that make it inevitable that this walking

POS spends time with guys that will call him "bubba"

[av8rdave]

11. I SO hope so!

[rollingrock]

14. Nauseating...and hilarious

dismayed the financial community didn't regulate itself, wants more deregulation?

Amazing people ever took him seriously. Greenspan is a cockroach.

[Lithos]

21. He is insane

Using the classic definition where repeating something hoping that the results will change, he is insane. He admits freely that people don't self-regulate even when they know better, but he believes that they will self-regulate themselves if this comes up again?

He doesn't realize that these people either thought it would not happen to them (they would get out before the crash, etc.) or that they could talk their way out of it. Turns out, they are talking their way out of it and effectively will do it again because they have no inhibition not too.

[ronnie624]

24. When I hear someone who understands how the system works,

advocating for deregulation, I know I'm looking at a true enemy to the working class; someone whose only interest is keeping power and capital in the hands of a select few.

[goclark]

27. And his wife Andrea Mitchell keeps him informed

and in front of the Media so that his/their book deals and $$$'s will keep flowing while our $$'s sink. :puke:

[roamer65]

15. Fuckhead Greenspan should have let us have the recession we were meant to have 2001-02.

It would have been worse of a downturn, but not as bad as what we are facing now. He knew exactly where a hyperexpansive monetary policy would lead us. Fucking criminal.

[Raster]

17. Torch, pitchfork and greenspan's head on a pike!

I think that about covers it.

[DallasNE]

18. Interesting Admission By Greenspan

Greenspan acknowledged that the housing bubble mitigated the losses suffered when the stock market bubble burst. While Greenspan didn't admit it, he could well have orchestrated the housing bubble for that very purpose. So, where did Greenspan think it would all end? Did he think we would be greeted as liberators or something? What did he think the outcome of extended 1% interest rates combined with easy money be? It seems that just about everybody but Greenspan knew where that had to end. Well, maybe not Andrea Mitchell.

[unkachuck]

20. hey andrea....

....it's good to see your big 'A' is out of the house and working again, sort of....giving speeches?

....I wouldn't put up with that if I were you....here you are chasing Hillary around the world, losing sleep and working your ass off while your old-man is sand-bagging it....I'd send that boy out for a real job....

....tell him to rewrite his resume and email it to Harvard....I hear Harvard is now looking for a Professor of Fuckanomics....

[mitchum]

22. Atlas Weaseled

[Javaman]

25. "worst recession since the 30's", excuse me if I'm wrong but that was a

DEPRESSION, YOU FUCKING MORON!!

so is the term recession new speak for depression? It appears so. This fucking asshole architect of this financial mess we are in, only NOW wants to nationalize the banks. Let me guess is this has been loser scrambling to be that person in charge of this nationalization? Lord have mercy on our stupid souls.

[tbyg52]

26. My eyes nearly rolled out of my head when I read the subject of the OP

Takes a lot of nerve for him to bloviate to us when it's largely his fault.

[Solly Mack]

28. Ouch. My head....my head

- Greenspan, a proponent of self-regulation, said he was "deeply dismayed" when in August 2007 the premise that firms had the enlightened self interest to monitor their own risk exposure "failed." -


- Still, he doesn’t think it’s necessary to strengthen rating-agency regulation. Essentially, they’re “already regulated,” he says, because investors’ loss of trust means the agencies are likely to lose business. “There’s no point regulating this. -

[No Elephants]

29. NBC fired Maria Shriver bc of potential conflict of interest, yet allows

Mrs. Greenspan do interviews on the economy without even a disclosure of potential conflict.

Wonder what accounts for the difference in treatment.

Let me think.


*Scratches head*

What do YOU think could possibly account for the difference, boys and girls?