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The NYT Turns to the Arsonist to Analyze the Fire: Greenspan on Bank Bailouts
Alan Greenspan is certainly in a position to know about the problems the financial system is facing. After all, there is no one who bears greater responsibility for today's events.
But, it would be appropriate to remind readers that Greenspan was the arsonist here. He was the one who choose to ignore the abusive lending practices in the mortgage industry that became widespread under his tenure. He was the one who chose to ignore the growth of an $8 trillion housing bubble.
When he said that, "This is a once-in-a-half-century, probably once-in-a-century type of event," it might have been worth pointing out that he was the arsonist who created the conditions for the extraordinary set of events hitting Wall Street.
--Dean Baker
COMMENTS (8)
Lehman files Chapter 11.
Merril bought by BoA.
AIG asking for 40 billion from gov.
Triple Whammy.
Posted by: no | September 15, 2008 2:43 AM
It's also worth pointing out that, in the opinion of John McCain, Greenspan is "such a great mind that he'd appoint him to overhaul our tax code even if he was dead."
John McCain: Lover of financial arsonists. haha
Posted by: JAB | September 15, 2008 3:02 AM
A fun game to get market-watchers through the day might be to count how many Economists, how many commentators, & how many "savvy" pundits will come out of the woodwork this morning spouting, "there's plenty of blame to go around".
Posted by: bailey | September 15, 2008 5:30 AM
There will also be a lot of
"who could have known" and "who could have predicted" comments (obviously being amnesiacs about Dean Baker, Nouriel Roubini, Paul Krugman, Robert Schiller, Bard DeLong, etc.)
But apparently the Luskins, whose piece about what a wonderful economy we actually have but for those negative spinning Democrats and "liberal" media appeared with such remarkable unintended iron in yesterday's Post, and who proudly (but in a well buried, kind of by the way sense) identified himself as one of John McCain's financial advisors will be providing advice to him as the next President. It will be an interesting 4 years, especially with all the wondeful new wars McCain wants to start (see www.theAtlantic.com). Month
Posted by: Rick Kane | September 15, 2008 7:43 AM
Let us not forget the contribution of that other infamous "economist" and former McCain Chief Financial advisor, AND USB Vice Chairman, former US Senator Phil "let's deregulate everything" Gramm.
Y'all are just a bunch of whiners! He of the Gramm-Leach-Bliley Financial Services Modernization Act that repealed the Glass-Stegall Act that prevented common ownership of commercial and investment banks and insurance companies!
Posted by: Mike | September 15, 2008 11:36 AM
It may be appropriate to remind your readers what an ad hominem attack is. If you have a problem with the Greenspan's analysis, point out the specifics. Focusing on Greenspan's guilt is irrelevant.
Posted by: biomed.tim | September 15, 2008 12:37 PM
We need Paul Volcker. A pragmatic patient crisis handler: well grounded.
My disdain for Greenspan goes waaay back. Any mature man with his head in the aynrandosphere is freaky enough: it's downright scary when his harem is in the money vault.
Posted by: NeW | September 16, 2008 12:54 PM
. Any mature man with his head in the aynrandosphere
Ayn Rand was a sound-money advocate. She would have shredded Greenspan for jumping on the inflation bandwagon.
What Greenspan should be reviled for is the fact that he knew better, and still went right ahead and inflated like crazy. Look up the paper he wrote on the gold standard before he sold out and went to work for the bad guys.
-jcr
Posted by: John C. Randolph | September 20, 2008 1:58 AM