Saturday, March 20, 2010

Greenspan Didn't See Subprime Crisis Coming: Warning Bell Would Not Go Over Well With Congress

Former head of the Federal Reserve, Alan Greenspan, and husband of NBC reporter Andrea Mitchell, said he didn't see the subprime crisis coming. He must have been looking left.

Alan Greenspan and Andrea Mitchell

That was in 2007. In 2009 Greenspan said he was "mystified" by the Subprime market. Once he got a clue, however, he admits he could have done something to stop the certain disaster:
While Mr. Greenspan acknowledges that he could have done something to avert the housing crisis, he contends his hands were tied.
"If we tried to suppress the expansion of the subprime market, do you think that would have gone over very well with the Congress?...When it looked as through we were dealing with a major increase in home ownership, which is of unquestioned value to this society -- would we have been able to do that? I doubt it."
Mr. Greenspan said that if he had taken steps to prevent the crisis, the outcome would have been painful.
Greenspan should have handled Congress, which demanded the Community Reinvestment Act  (CRA) providing loans to people who could not afford them. The Federal Reserve is set apart from, and is independent of, Congress. The truth is, by doing his job, Greenspan would have alienated his uber liberal wife from her progressive high-profile friends. Can you imagine NBC or MSNBC forced to report that Andrea's husband was trying to shutdown loans to minorities? What Greenspan allowed to happen to this country should have him behind bars.

While president of the Federal Reserve, Greenspan's pertinent responsibilities, and those of his successor, Ben Bernake, were the following:
...influencing monetary and credit condition in the economy to achieve maximum employment, stable prices and moderate long-term interest rates
...regulating banking institutions to ensure the safety and soundness of the nation's banking and financial system, and protect the credit rights of consumers
...maintain stability of the financial system and containing systemic risk that may arise in financial markets
Both Greenspan and Bernanke failed miserably in their duties to the American people, and yet Bernake still heads the Feds. The outcome of the crisis has been beyond painful, especially for those who refused to pay inflated prices for their homes and refused to sign a loan they could not afford - yet find no money available to them for their own business ventures or home improvements.

Read about the Democrat agenda in the Community Reinvestment Act:
Tracking the Mess of Fannie and Freddie

Maxine Waters: Bailout Bankers Grilled

Linked by An Ol' Broad's Ramblings - Thank you sweet friend!

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