Bubba's worst mistake was reappointing a ideologically driven hack like Alan Greenspan as Chairman of Fed Reserve. (according to his bio: He enjoys classical music, tennis, the writings of Ayn Rand, and reportedly writes all his speeches in the bathtub)
Here is a sample of Greenspanism from today's Congressional Hearing.
- Greenspan Urges Fiscal Fix Through Spending By Glenn Somerville
WASHINGTON (Reuters) - Federal Reserve (news - web sites) Chairman Alan Greenspan (news - web sites) on Wednesday urged Congress to make swift adjustments to ready U.S. retirement and Medicare programs for a coming wave of retirees, saying spending controls
were key.
In prepared testimony to the House Budget Committee, Greenspan said that pushing taxes up enough to meet future spending promises under Social Security (news - web sites) and Medicare might pose a risk to the overall economy.
"The exact magnitude of such risks is very difficult to estimate, but they are of enough concern, in my judgment, to warrant aiming to close the fiscal gap primarily, if not wholly, from the outlay side," he said.
The Bottom Line: Balance the budget on the backs of the poor and the middle class.
Greenspan says ARMs might be better
By Sue Kirchhoff and Barbara Hagenbaugh, USA TODAY
Federal Reserve (news - web sites) Chairman Alan Greenspan said Monday that Americans' preference for long-term, fixed-rate mortgages means many are paying more than necessary for their homes and suggested consumers would benefit if lenders offered more alternatives.
*
Greenspan also said U.S. household
finances appeared generally sound, despite rising debt levels and bankruptcy filings. Low interest rates and surging home prices have
given consumers flexibility to manage debt, he said.
"Overall, the household sector seems to be in good shape," Greenspan said.
Americans have been buying homes and refinancing mortgages at a record pace in the past several years, lured by low interest rates.
Most mortgages are fixed rate, so consumers can prepay when rates go down but do not face higher costs if rates rise. Under adjustable-rate mortgages (ARMs), which made up about 28% of mortgages in January, borrowers usually have lower initial rates but face the risk of higher payments if rates in the broader economy rise.
Bottom Line: Now the banks face the risk on high interest rates. If the rates go down, the consumers can refinance, the banks cannot. If Greenspan had his way, the it's the homeowner who will bear the risk.
This guy isn't fit to clean Volker's shoes.
