Last week I saw an interesting interview with Alan Greenspan, former Chairman of the Federal Reserve Board, on The Today Show. He has a new book out, and thus appears to be making the rounds in support of its release. While I can’t cover everything he said in painstaking detail, I did jot down a few of the more interesting tidbits…
» He claims that his biggest frustration was President Bush’s “unwillingness to wield his veto against out of control spending.” He thought that the structure of the Bush tax cut was fine, but also felt that it needed to be paid for.
» He doesn’t accept any blame for the not foreseeing the problems with the housing bubble in the United States – he claims they tried to get mortgage rates up, but failed. He further claims that all 20-30 other countries have the same problem because the low interest rates were caused by “global forces” (i.e., a sharp decline in long term interest rates).
» He thinks oil would be in the $130-$140 per barrel range if we hadn’t gone to war in Iraq: “The way I read Saddam, that’s where he was going.”
» Does he have any thoughts for new homebuyers? Yep… He’s “worried” about the current credit crunch. He further stated that “we’re going to have to go through this adjustment” just as other countries that have been experiencing a housing bubble will have to do. He further recognized that a lot of people will have “very tragic stories.”
» Finally, does he think we’re headed for a recession? Not yet. There are some open questions, but for the moment “we’re doing okay.”
For more info, check out “The Age of Turbulence: Adventures in a New World.”
4 Responses to “Words of Wisdom from Alan Greenspan”
Thanks for sharing some excerpts. I need a good book to read I will have to check this out.
I used to like Greenspan a lot. He’s a likable guy and the press loves him. Maybe he wasn’t bad, but I do put a lot of the blame on him for the credit bubble.
I don’t understand how he can claim to not have a role. During his stay the fed held interest rates pretty low, fueling a buy and debt mentality over being fiscally responsible.
Would the tech crash of 2000 be worse if he didn’t? Yes, but the current crisis is a direct results of his solution.
Just my opinion of course.
I agree with Aaron. It is so easy to judge from the outside when you don’t have the responsibility of what Ben Bernanke has to deal with. Greenspan is just making matters worst by offering his “advice” about everything.
On an off topic note, I saw the CNBC interview with Maria Bartraromo (i can’t spell her last name) and she was crying on parts of the segment. They must have cut the parts when she totally broke down but i wonder why!
Greenspan certainly has been making the rounds. I understand he is doing this for PR right now, but I certainly hope he lets Bernanke do his job after this instead of constantly weighing in on monetary policy.