Greenspan Admits a Little Flaw
Greenspan spoke today and offered a no shit concession that there were flaws in his market ideology – in case you couldn’t tell by the state of the world economy. Blaming a “once in a century credit tsunami,” Greenspan offered the House Committee on Oversight and Government Reform a partial admittance that he was wrong about opposing regulation of derivatives before acknowledging that financial institutions didn’t protect shareholds and investments as well as he’d expected. I guess he forgot about that significant human flaw: greed.
Fanning the flames burning at Greenspan’s heels, Henry Waxman, a California Democrat said Greenspan had “the authority to prevent irresponsible lending practices that lead to the subprimie mortgage crisis.” He went on to say, “You were advised to do so by many others and now our whole economy is paying the price.”
My opinion – the country (George Bush) left one man in charge for too long. Greenspan says that finance is an inexact science, and I agree with that assessment, but I also believe that riding on one’s laurels and past successes is a recipe for failure. What Greenspan should have done is raised rates – with less consideration for inflation – to control the housing boom. Slow things down to keep home prices from going too high. That and some regulation to reduce the predatory lending practices probably would have done a lot of good.
Hindsight, yes, but this is free. People like Greenspan are paid to know more than what we can see in our mirror.
Ranter
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