Greenspan … Wrong On Regulation
"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!
Greenspan … Housing Bottom In Sight
Former Federal Reserve chairman Alan Greenspan said this week "Home prices in the U.S. are likely to start to stabilize or touch bottom sometime in the first half of 2009, prices could continue to drift lower through 2009 and beyond." Let's all hope he is right. But, a quick review of his past real estate bust comments, shows that this week's bottom call is Greenspan's third such prediction.
First in late 2006, the former fed head said: "I suspect that we are coming to the end of this downtrend, as applications for new mortgages, the most important series, have flattened out. I don't know, but I think the worst of this may well be over."
The second Greenspan call was in April 2008, when he said "the drop in U.S. home prices will probably end well before' early next year as the number of houses on the market diminishes, aiding an economic rebound."
Will this week's Greenspan market bottom call be any more accurate than his prior two calls? I personally hope so! But, I do have my doubts. It used to be that when Greenspan spoke one was never really sure of exactly what he was saying. Now, his latest comments are crystal clear…Hmm! San Diego income property sales