http://biz.yahoo.com/ap/070907/greenspan_remarks.html?.v=2
Report: Greenspan Says Turmoil Like '98
Friday September 7, 12:03 am ET
Report: Former Federal Reserve Chairman Alan Greenspan Says Market Turmoil Like 1998, 1987
NEW YORK (AP) -- "The human race has never found a way to confront bubbles," former Federal Reserve Chairman Alan Greenspan said Thursday in reference to the euphoria that can precede contractions, or reactions, like the current market turmoil, according to a published report.
Greenspan, speaking to economists in Washington, D.C., compared the turmoil to that of 1987 and in 1998, when the giant hedge fund Long-Term Capital Management nearly collapsed, The Wall Street Journal reported on its Web site. "The behavior in what we are observing in the last seven weeks is identical in many respects to what we saw in 1998, what we saw in the stock-market crash of 1987, I suspect what we saw in the land-boom collapse of 1837 and certainly the bank panic of 3/8 1907," Greenspan said at the event organized by the Brookings Papers on Economic Activity, according to the Journal.
Greenspan, now a private consultant, said euphoria takes over when the economy is expanding and leads to bubbles, "and these bubbles cannot be defused until the fever breaks," the Journal said. Bubbles can't be defused through incremental adjustments in interest rates, he suggested, the paper reported. The Fed doubled interest rates in 1994-95, and "stopped the nascent stock-market boom," but when stopped, stocks took off again. "We tried to do it again in 1997," when the Fed raised rates a quarter of a percentage point, and "the same phenomenon occurred."
Replies
57
Beach Lover
Great find, NMosley.
I think the key is in the last part of the first sentence: "a global exchange platform spanning the US, Europe, the Middle East and other strategic markets."
It looks like they are laying the groundwork to combine stock exchanges. The question I ask is what will be the currency of choice? The dollar, the Euro?
Europe began unifying the economies of its countries via a common currency, the Euro. There are plans for the North American continent as well.
[ame]http://en.wikipedia.org/wiki/Amero[/ame]
[ame="http://www.youtube.com/watch?v=_3jdQxDC7pA"]YouTube - CNBC Interview with Stephen Previs about the Amero [hq][/ame]
And, for the bonus round, the Security and Prosperity Partnership is scheduled to be complete by 2010:
[ame="http://www.youtube.com/watch?v=H65f3q_Lm9U"]YouTube - Lou Dobbs: North American Union Orwellian Brave New World[/ame]
I think the key is in the last part of the first sentence: "a global exchange platform spanning the US, Europe, the Middle East and other strategic markets."
It looks like they are laying the groundwork to combine stock exchanges. The question I ask is what will be the currency of choice? The dollar, the Euro?
Europe began unifying the economies of its countries via a common currency, the Euro. There are plans for the North American continent as well.
[ame]http://en.wikipedia.org/wiki/Amero[/ame]
[ame="http://www.youtube.com/watch?v=_3jdQxDC7pA"]YouTube - CNBC Interview with Stephen Previs about the Amero [hq][/ame]
And, for the bonus round, the Security and Prosperity Partnership is scheduled to be complete by 2010:
[ame="http://www.youtube.com/watch?v=H65f3q_Lm9U"]YouTube - Lou Dobbs: North American Union Orwellian Brave New World[/ame]
Beach Lover
As an Patriotic American, I am encouraged by the number of views on this thread.
PLEASE investigate and research what is happening to our republic.
Please remember that our fathers, grandfathers, and forefathers fought and died so that we could be free.
I have come to love watching CNN's Lou Dobbs. Other than that, if you are counting on the main stream media for your news, you are uninformed.
We, the people, have the Internet.
PLEASE investigate and research what is happening to our republic.
Please remember that our fathers, grandfathers, and forefathers fought and died so that we could be free.
I have come to love watching CNN's Lou Dobbs. Other than that, if you are counting on the main stream media for your news, you are uninformed.
We, the people, have the Internet.
Beach Fanatic
As an Patriotic American, I am encouraged by the number of views on this thread.
PLEASE investigate and research what is happening to our republic.
Please remember that our fathers, grandfathers, and forefathers fought and died so that we could be free.
I have come to love watching CNN's Lou Dobbs. Other than that, if you are counting on the main stream media for your news, you are uninformed.
We, the people, have the Internet.
And if you are counting on Lou Dobbs for your news you are informed by ignorance.
beats on hood
He also said in an interview that he was in the bathtub when he asked Andrea Mitchell to marry him. He declined when asked if she was in the bathtub with him at the time.;-)
Beach Lover
And if you are counting on Lou Dobbs for your news you are informed by ignorance.
Are you saying Lou Dobbs is uninformed, or is passing on false information?
I watch Lou Dobbs for a fraction of my news. I like the fact that he keeps attention on the border situation.
Here are a couple of good ones:
http://globaleconomicanalysis.blogspot.com/
http://www.bullnotbull.com/bull/ Lots of good links on this one.
Beach ComberAuthor
http://www.npr.org/templates/story/story.php?storyId=17210282
Greenspan: Recession Odds 'Clearly Rising'
Morning Edition, December 14, 2007 ? Global forces beyond the Federal Reserve's control helped fuel the bubble that led to the current housing meltdown, former Fed Chairman Alan Greenspan said Thursday. In an NPR interview, Greenspan also said that the odds of a recession are "clearly rising."
This week, Greenspan wrote a commentary in The Wall Street Journal looking at the roots of the current mortgage crisis. In the article, he defended the Fed's decision to keep rates low ? a move that some people say fueled the housing bubble.
'Extraordinary Forces of Globalization'
"The problem is not explaining myself," Greenspan told Steve Inskeep in an NPR interview. "The problem is getting a focus on how to look at the world's economy more appropriately. Certain things are happening in the world which are affecting central banks, have affected central banks, essentially because of the extraordinary forces of globalization that arose subsequent to the end of the Soviet Union."
Greenspan rejected the criticism that the Federal Reserve fueled the housing bubble by lowering interest rates.
That argument "doesn't coincide with the facts," he said. "First of all, we've had housing bubbles in two dozen or more countries around the world ... everybody's long-term rates have gone down."
Fed 'Lost Control' of Long-Term Rates
Greenspan noted that there has been a disconnect in recent years between the Fed's short-term rate moves and long-term rates, such as those that apply to mortgages.
When the Fed began to raise rates in 2004, the central bank had expected to get ? "as a bonus" ? a rise in mortgage rates, Greenspan said. But that didn't occur, he said.
"We concluded that the monetary forces that were arising in the world globally had become so overwhelming, relative to the resources of central banks, that we had effectively lost control of long-term interest rates and the forces directing higher prices and homes," he said.
Asked if the Fed could have prevented, or eased, the U.S. housing bubble, he said, "There's only one thing we could have done ? cutting off short-term credit. But that would have broken the back of the economy and brought the housing boom down."
Short of raising interest rates dramatically, "the evidence is very clear that there was nothing that any central bank could have done, or tried to do."
He said the housing meltdown was "inevitable in one sense: When you get a type of euphoria building in an economy, you're dealing with the innate aspects of human nature. And I've watched bubbles inflate and deflate for 60 years. I'm pretty much convinced that we will never be able, by monetary or fiscal policy or government actions, short of disabling the economy, (to undermine) those bubbles.
"Eventually, this has to defuse itself," he said.
Economy Close to Stalling
Greenspan said it's too soon to say whether a recession is coming, "but the odds are clearly rising."
"We're getting close to stall speed" in economic growth, he said. "And we are far more vulnerable at levels where growth is so slow than we would be otherwise.
"Indeed ... somebody who has an immune system which is not working very well is subject to all sorts of diseases, and the economy at this level of growth is subject to all sorts of potential shocks."
Greenspan: Recession Odds 'Clearly Rising'
Morning Edition, December 14, 2007 ? Global forces beyond the Federal Reserve's control helped fuel the bubble that led to the current housing meltdown, former Fed Chairman Alan Greenspan said Thursday. In an NPR interview, Greenspan also said that the odds of a recession are "clearly rising."
This week, Greenspan wrote a commentary in The Wall Street Journal looking at the roots of the current mortgage crisis. In the article, he defended the Fed's decision to keep rates low ? a move that some people say fueled the housing bubble.
'Extraordinary Forces of Globalization'
"The problem is not explaining myself," Greenspan told Steve Inskeep in an NPR interview. "The problem is getting a focus on how to look at the world's economy more appropriately. Certain things are happening in the world which are affecting central banks, have affected central banks, essentially because of the extraordinary forces of globalization that arose subsequent to the end of the Soviet Union."
Greenspan rejected the criticism that the Federal Reserve fueled the housing bubble by lowering interest rates.
That argument "doesn't coincide with the facts," he said. "First of all, we've had housing bubbles in two dozen or more countries around the world ... everybody's long-term rates have gone down."
Fed 'Lost Control' of Long-Term Rates
Greenspan noted that there has been a disconnect in recent years between the Fed's short-term rate moves and long-term rates, such as those that apply to mortgages.
When the Fed began to raise rates in 2004, the central bank had expected to get ? "as a bonus" ? a rise in mortgage rates, Greenspan said. But that didn't occur, he said.
"We concluded that the monetary forces that were arising in the world globally had become so overwhelming, relative to the resources of central banks, that we had effectively lost control of long-term interest rates and the forces directing higher prices and homes," he said.
Asked if the Fed could have prevented, or eased, the U.S. housing bubble, he said, "There's only one thing we could have done ? cutting off short-term credit. But that would have broken the back of the economy and brought the housing boom down."
Short of raising interest rates dramatically, "the evidence is very clear that there was nothing that any central bank could have done, or tried to do."
He said the housing meltdown was "inevitable in one sense: When you get a type of euphoria building in an economy, you're dealing with the innate aspects of human nature. And I've watched bubbles inflate and deflate for 60 years. I'm pretty much convinced that we will never be able, by monetary or fiscal policy or government actions, short of disabling the economy, (to undermine) those bubbles.
"Eventually, this has to defuse itself," he said.
Economy Close to Stalling
Greenspan said it's too soon to say whether a recession is coming, "but the odds are clearly rising."
"We're getting close to stall speed" in economic growth, he said. "And we are far more vulnerable at levels where growth is so slow than we would be otherwise.
"Indeed ... somebody who has an immune system which is not working very well is subject to all sorts of diseases, and the economy at this level of growth is subject to all sorts of potential shocks."
Beach Fanatic
Lou Dobbs - isn't he an old boxing trainer? Does training Mexican fighters make him an expert on immigration issues?
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