November 21, 2024

"I made a mistake," Greenspan said, "in presuming that the self-interests of organizations, specifically banks and others, were such as that they were best capable of protecting their own shareholders and their equity in the firms." 

"The Federal Reserve had as good an economic organization as exists," Greenspan said. "If all those extraordinarily capable people were unable to foresee the development of this critical problem . . . we have to ask ourselves: Why is that? And the answer is that we're not smart enough as people. We just cannot see events that far in advance."

 

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"We have to recognize that this is almost surely a once-in-a-century phenomenon," Greenspan said, "and in that regard, to realize the types of regulation that would prevent this from happening in the future are so onerous as to basically suppress the growth rate in the economy and . . . the standards of living of the American people."    

Prior related posts:

Cramer Calls the Bottom in Real Estate Market

Greenspan … Housing Bottom In Sight

Greenspan … We Are In A Recession

30% chance the U.S. economy falls into recession in 2008

Fed Cuts .25% From Interest Rates To Help Housing Market

Former Fed Chief … Would Not Be Surprised If The Housind Drop Was “in double digits.”

Greenspan on The Housing Bust

Employment Report Negative Surprise . . . for Some

4 Sure Signs of A Real Estate Market Top

Greenspan – Possible Recession This Year! 

 


11 thoughts on “Greenspan … Wrong On Regulation

  1. Those hurting the most with gross unfairness are those paying mortgages on time owning homes devalued far below original cost. It’s very tempting for these folks who can move or even rent elsewhere to return keys to the bank (jingle mail) and just walk out. Millions of these cases exist today with older loans at $250,000 plus their down payments, now discovering their $300,000 home is worth $150,000. Further, it might be another 20 years before old values return. Talk about paying on a dead horse!

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  2. I grew up in Argentina in the 60’s, 70’s, 80’s–and for me it’s easy to see the writing on the wall (of course I’ve read it once before, albeit in Spanish). The U.S. Dollar is now in its LAST DAYS as it enters into the spiral of hyperinflation/maxidevaluation. In a matter of 2-3 years, if the dollar even still exists, you’ll be lucky to buy a decent meal for $10,000. The price of gold, in nominal terms, may be in the hundreds of thousands or even millions.

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  3. When this US dollar bubble blows it will make the housing bubble blowing look like a picnic in the Hamptons. It’s not a matter of IF, it’s a matter of WHEN and it’s a lot sooner than most people think. And the ONLY thing you’d want to be in when that happens is GOLD. This is a great opportunity to BUY for those who have their eyes on the horizon, and not just a few feet beyond the end of their nose.

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  4. Objectively speaking, gold is a poor investment if your outlook is very short…but longer term, gold is gauranteed to rise sharply…just have patience…I sold my GOLD at 900+ and I wont buy back until it gets below 600.00…when the mkts rally in a few weeks from now after finding the bottom, gold will rise again with the other commodities but after a few month bear market rally, gold and oil/commodities will once again start the decline as we continue the deflationary cycle…but when the true money supply finally increases(i.e.-when banks stop hoarding it when they feel fiscally safe again) which should occur 2-3 yrs from now, we will have hyperinflation from all the trillions that our govt poured into the system and is being finally released…at that point I will be buying physical gold as a investment and as a currency…5 yrs from now I bet gas is 10.00 and a loaf of bread will be 5.00…oil should see 200.00 and gold 2000.00.

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  5. At some point, the dollar will collapse and interest rates will go up sharply…it has to because foreigners will dump our dollars and our treasuries and will only be enticed to buy them again when they get rewarded for their risk…the markets set the interest rates and not the Feds…I guarantee you will interest rates will go up when foreigners wake up and stop buying our debt.

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  6. GREENSPAN:
    He refuses to lay the problem where it has existed all along – Social Engineering as a precept of Government, Lawsuits by socialist-leaning government-funded organizations on banking institutions, Oversight mission creep from protecting the citizens to looking the other way in order to gain votes, and lastly … the practice of packaging blocks of “JUNK” mortgages as securities that were able to be traded internationally asnegotiable instruments.

    Why were the Executives at FannieMae and FreddieMac (quasi-government loan guarantee organizations set up by Congress with the support of taxpayer money) able to be paid with bonus incentives in the hundred million dollar range in six years?

    Franklin Raines alone reportedly received 90 million dollars in six years on bonus incentives packaging federally backed mortgages (backed with taxpayer money) and sold to Wall Street. This was a quasi government position that was allowed to loosen the qualification rules on mortgages in order to create the paper (JUNK Mortgages) that has us in trouble at this moment.

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