Greenspan see the start of Stag-flation!

[Mega]

I seen it on the bottom of the Bloomberg ticker...........Oh Boy!
Mike

[Rajiv]

Re: Greenspan see the start of Stag-flation!

Greenspan sees early signs of US stagflation

The U.S. economy is showing early signs of stagflation as growth threatens to stall while food and energy prices soar, former U.S. Federal Reserve Chairman Alan Greenspan said on Sunday.

In an interview on ABC's "This Week with George Stephanopoulos," Greenspan said low inflation was a major contributor to economic growth and prices must be held in check.

"We are beginning to get not stagflation, but the early symptoms of it," Greenspan said.

Originally from ABC News: This Week with George Stephanopoulos

The video is supposedly here but I have been unable to access it so far

[metalman]

Re: Greenspan see the start of Stag-flation!

Greenspan sees early signs of US stagflation



Originally from ABC News: This Week with George Stephanopoulos

The video is supposedly here but I have been unable to access it so far

this worked for me...

http://www.abcnews.go.com/Video/playerIndex?id=4007604

[Mega]

Re: Greenspan see the start of Stag-flation!

I was rather in hope that you gents would like comment on this, but sadly not
Mega

[Tulpen]

Re: Greenspan see the start of Stag-flation!

There is not much to comment. Under Greenspan's leadership a housing asset bubble was created. Even worse, he knew about it and actively resisted an inquiry into lending practices.

Now he wants to bail out CDO holders by giving them government money through mortgage holders.

"It's far less damaging to the economy to create a short-term fiscal problem, which we would, than to try to fix the prices of homes or interest rates. If you do that, it'll drag this process out indefinitely,"

A short-term fiscal problem? :rolleyes:

[metalman]

Re: Greenspan see the start of Stag-flation!

I was rather in hope that you gents would like comment on this, but sadly not
Mega

old news, i'd say. greeny is finally acknowledging the inevitable result of his own stupid policies.

[bart]

Re: Greenspan see the start of Stag-flation!

From CR's blog today:

And for fun, here are some Greenspan quotes from the '90/'91 recession: (bear in mind that the recession started in July, 1990):

“In the very near term there’s little evidence that I can see to suggest the economy is tilting over [into recession].” Greenspan, July 1990

“...those who argue that we are already in a recession I think are reasonably certain to be wrong.” Greenspan, August 1990

“... the economy has not yet slipped into recession.” Greenspan, October 1990

Source (pdf): "Booms, Busts, and the Role of the Federal Reserve" by Dr. David Altig.

[santafe2]

Re: Greenspan see the start of Stag-flation!

Now he wants to bail out CDO holders by giving them government money through mortgage holders.

While deceptively simple, this is such a key concept. It's likely most on this board understand this intuitively but a point that will prove too subtle for the majority of Americans. These mortgage holders being "helped" by the government are just an acceptable conduit to funnel additional funds to the various owners of this leveraged debt. These borrowers would most likely be better served by letting the market correct but the banking system is better served by using these people to create enough space and time to unwind and off-load as much of this debt as possible. My opinion only, but these people will likely find themselves further upside-down in 3 years than they are today and will wish they'd taken their loses and moved on.

[Finster]

Re: Greenspan see the start of Stag-flation!

old news, i'd say. greeny is finally acknowledging the inevitable result of his own stupid policies.

Here in the hinterlands of Western Pennsylvania, we have an old saying:

Every skunk smells his own hole first.