Former Federal Reserve Chair Alan Greenspan finally has admitted the error of the philosophical underpinnings of his and the Republican business and economics world.
It is a long way from his talking about "irrational exuberance", recommending homeowners use Adjustable Rate Mortgages, and this long time follower and supporter of the late Ayn Rand finally admits the flaw of this phosophy in an interview by Alan Greenspan with the Financial Times set out below the jump.
The headline on the weekend edition of the Financial Times last week, February 14, 2009 was as follows: "Eurozone slump worst for 50 years."
At the G7 finance ministers meeting in Rome the UK Chancellor, Alastair Darling, said the economies of the world were going through "one of the severest downturns in generations" and that "governments must take extraordinary actions at extraordinary times." (Page 1, Financial times, Feb. 14, 2009).
The Greenspan interview is summarized as follows:
The US government may have to nationalise some banks on a temporary basis to fix the financial system and restore the flow of credit, Alan Greenspan, the former Federal Reserve chairman, has told the Financial Times.
In an interview, Mr Greenspan, who for decades was regarded as the high priest of laisser-faire capitalism, said nationalisation could be the least bad option left for policymakers.
"It may be necessary to temporarily nationalise some banks in order to facilitate a swift and orderly restructuring," he said. "I understand that once in a hundred years this is what you do."
http://www.ft.com/...
The US news folks downplay this admission by Alan Greenspan, but he has a very odd relationship with the US main stream news media which rarely shows his failures, even when he admits them. Of course watching Andrea Mitchell cover the travels of the Secretary of State to Japan, whose stock market took a dive after the "irrational exuberance" statement of her husband, Alan Greenspan, raises a whole new set of issues about the objectivity of the US MSM and it may relate to the role of Ms. Mitchell.
(Maybe the overwheming problems explains why the Japanese finance minister appeared blotto?)
More important that that coverage, however, is the need for serious coverage of the true extent of the internaitonal nature of this crisis.
While the right wingers focus on inaccurate and foolish stories about money for mouse habitat in Calfornia and high speed gambling trains in Nevada, the serious discussion in serious circles is about the real nature of the international nature of this crisis.
I hope we who write and exchange our views here will focus on what is important and why we need to support the President and his efforts. We need to stomp on the trash talking of the Limbaugh and Hannety and Santelli right wing panderers. The efforts that elected President Obama need to be made again to support his programs to deal with the US part of this world economic crisis.