Greenspan: Market turmoil fits pattern

[DesertFox]

The current market turmoil in the United States is in many ways "identical" to that which occurred in 1987 and 1998, The Wall Street Journal quoted former Federal Reserve Chairman Alan Greenspan as saying on Friday.

Greenspan, Fed chairman from 1987 to 2005 and now a private consultant, told a group of academic economists in Washington, D.C., Thursday night that business expansions are driven by euphoria and contractions by fear, according to the report.

While economists tend to think the same factors drive expansions and contractions, "the expansion phase of the economy is quite different, and fear as a driver, which is going on today, is far more potent than euphoria."

The euphoria in human nature takes over when the economy is expanding for several years, and leads to bubbles, "and these bubbles cannot be defused until the fever breaks," he said.

More (http://news.xinhuanet.com/english/2007-09/07/content_6683976.htm)

[Etaoin]

The current market turmoil in the United States is in many ways "identical" to that which occurred in 1987 and 1998, The Wall Street Journal quoted former Federal Reserve Chairman Alan Greenspan as saying on Friday.

Greenspan, Fed chairman from 1987 to 2005 and now a private consultant, told a group of academic economists in Washington, D.C., Thursday night that business expansions are driven by euphoria and contractions by fear, according to the report.

While economists tend to think the same factors drive expansions and contractions, "the expansion phase of the economy is quite different, and fear as a driver, which is going on today, is far more potent than euphoria."

The euphoria in human nature takes over when the economy is expanding for several years, and leads to bubbles, "and these bubbles cannot be defused until the fever breaks," he said.

More (http://news.xinhuanet.com/english/2007-09/07/content_6683976.htm)

The Maestro, as usual, speaks gobbledy gook! His creation of, and failure to deal with the bubbles he created now leaves his successor with no genuine ammunition! Keep this in mind: Long Term Capital Management. Their Bust threatened the market, so "Bubbles" Greenspan arranged a bailout instead of a dip in the market. He looked like a genius, but the penalty of bankruptcy for bad judgment was taken off the table. Greenspan printed more "funny money" than all the heads of the FED before him plus the manipulation of credit! Far in excess of the amount warranted by the productive power of the U.S. The international markets are now responding by devalueing the $$$. Maybe we should start comparing it with the Reichmark rather than the Remnimbi or Yen.