imc indymedia

Los Angeles Indymedia : Activist News

white themeblack themered themetheme help
About Us Contact Us Calendar Publish RSS
Features
latest news
best of news
syndication
commentary


KILLRADIO

VozMob

ABCF LA

A-Infos Radio

Indymedia On Air

Dope-X-Resistance-LA List

LAAMN List




IMC Network:

Original Cities

www.indymedia.org africa: ambazonia canarias estrecho / madiaq kenya nigeria south africa canada: hamilton london, ontario maritimes montreal ontario ottawa quebec thunder bay vancouver victoria windsor winnipeg east asia: burma jakarta japan korea manila qc europe: abruzzo alacant andorra antwerpen armenia athens austria barcelona belarus belgium belgrade bristol brussels bulgaria calabria croatia cyprus emilia-romagna estrecho / madiaq euskal herria galiza germany grenoble hungary ireland istanbul italy la plana liege liguria lille linksunten lombardia london madrid malta marseille nantes napoli netherlands nice northern england norway oost-vlaanderen paris/Île-de-france patras piemonte poland portugal roma romania russia saint-petersburg scotland sverige switzerland thessaloniki torun toscana toulouse ukraine united kingdom valencia latin america: argentina bolivia chiapas chile chile sur cmi brasil colombia ecuador mexico peru puerto rico qollasuyu rosario santiago tijuana uruguay valparaiso venezuela venezuela oceania: adelaide aotearoa brisbane burma darwin jakarta manila melbourne perth qc sydney south asia: india mumbai united states: arizona arkansas asheville atlanta austin baltimore big muddy binghamton boston buffalo charlottesville chicago cleveland colorado columbus dc hawaii houston hudson mohawk kansas city la madison maine miami michigan milwaukee minneapolis/st. paul new hampshire new jersey new mexico new orleans north carolina north texas nyc oklahoma philadelphia pittsburgh portland richmond rochester rogue valley saint louis san diego san francisco san francisco bay area santa barbara santa cruz, ca sarasota seattle tampa bay tennessee urbana-champaign vermont western mass worcester west asia: armenia beirut israel palestine process: fbi/legal updates mailing lists process & imc docs tech volunteer projects: print radio satellite tv video regions: oceania united states topics: biotech

Surviving Cities

www.indymedia.org africa: canada: quebec east asia: japan europe: athens barcelona belgium bristol brussels cyprus germany grenoble ireland istanbul lille linksunten nantes netherlands norway portugal united kingdom latin america: argentina cmi brasil rosario oceania: aotearoa united states: austin big muddy binghamton boston chicago columbus la michigan nyc portland rochester saint louis san diego san francisco bay area santa cruz, ca tennessee urbana-champaign worcester west asia: palestine process: fbi/legal updates process & imc docs projects: radio satellite tv
printable version - js reader version - view hidden posts - tags and related articles

Greenspan and the Guilt of Others

by Felix Wadewitz Saturday, May. 01, 2010 at 6:52 PM
mbatko@yahoo.com

Before the committee, Greenspan immediately went on the offensive (cf. Creole trick). The irresponsible loans of banks caused the crisis, not the low interest of the Fed. The Fed failed in regulating the banks because its employees were not neutral.

GREENSPAN AND THE GUILT OF OTHERS

The Maestro became the bogeyman of the financial markets. Before the US Congress, the ex-chairman of the Federal Reserve fought for his reputation and lost. The respect of the US public for the former chairman Alan Greenspan has fallen enormously.

By Felix Wadewitz

[This article published in: DIE ZEIT 4/7/2010 is translated from the German on the Internet, http://www.zeit.de/wirtschaft/2010-04/greenspan-kongress-untersuchungsausschuss.]



Seldom have the traders on Wall Street criticized so much. “He only tries to save his backside.” This is not about Tiger Woods. Things are far more complex with Alan Greenspan. A few ordinary tees are not enough to reconcile the world with him.

Nothing offers so many topics of conversation as the fall of a superstar who for years was the standard of all things. Alan Greenspan was once the admired Maestro, Mister Dollar. He was regarded as nearly unimpeachable when he retired in 2006 after nearly twenty years at the helm of the Federal Reserve.

He had kept inflation low. He brilliantly mastered the stock market crash of October 1987. He gave America one of the longest growth phases of its history. After September 11, 2001 he saved the world economy from a recession by drastically lowering the interest rate.

Then the financial crisis erupted. Starting from the US housing market, the crisis quickly seized the whole world. Banks like Lehmann Brothers went bankrupt or had to be bailed out by the state like Hypo Real Estate in Germany. The taxpayer held out his head for financial market bets that were disasters and which he did not even know existed.

Greenspan landed right behind the speculators on the list of scapegoats. Greenspan first made possible the bubble on the housing market with his low interest policy for years and thus provoked the crisis. This was a central reproach. The banks had vast amounts of money so they gave loans to people who could not really afford them.

To delete the risk from their own books as fast as possible, the banks bundled these and other credits in packages whose contents were hardly reviewed and quickly sold them again. The Federal Reserve saw all this and should have prevented it, it is said now.

That Greenspan does not blame himself for anything is even more serious. He is “still not a Mensch,” Nobel Prize winner Paul Krugman decried in his blog – because the ex-Federal Reserve chairman did not simply say he was sorry.

The old man did not want to stand for all this. On Wednesday he faced a Congressional investigating committee on the financial crisis. He came to save his life work.

For weeks, he prepared for his appearance in the media. Firstly, the Brookings Institute published one of his papers in which he defended himself and his official acts. Then he toured through the Sunday political talk-shows on television.

Before the committee, Greenspan immediately went on the offensive. The irresponsible loans of banks caused the crisis, not the low interests of the Federal Reserve. Greenspan pointed to the semi-state mortgage giants Fannie Mae and Freddie Mac that accumulated toxic credits for years. However the Fed had no resources to better regulate these processes.

Many doubt this statement. “I would scrutinize every word of his a hundred times,” said Robert Auerbach of the University of Texas who wrote a critical book about the Federal Reserve under Greenspan’s leadership. The Fed failed in regulating the banks because its employees were not neutral.

For years it was common for the inspectors of the Fed to be uncritical in their visits to the banks. From Auerbach’s view, what is scandalous is that Greenspan found everything completely okay. Auerbach concluded: “The Fed always turned away when something dirty could be seen.”

Therefore the interrogation on Wednesday only focused on the margins. The committee chairperson Phil Angelides put some internal documents under Greenspan’s nose that revealed the Fed failed to limit deceptive awarding of credit – although it had the power to do that. “They could and should have regulated that but did not,” Angelides declared.

That seemed to leave Greenspan cold. In his term in office he “made terribly many mistakes” but no examples occurred to him regarding the financial crisis. Instead the rating agencies had responsibility since they wrongly assessed the risks of credit packages. The government pressed Fannie and Freddie to help as many people as possible in buying a home.

“All cow-dung,” trader David concluded. “Everyone blames the others and at the end no one is responsible.”

The television programs on Thursday promised more excitement. Golfer Tiger Woods will celebrate his return. If the athlete wins the Masters Tournament in Augusta, the extra-marital affairs will be forgotten. Americans love comeback stories.



Report this post as:

Local News

Change Links September 2018 posted S02 10:22PM

More Scandals Rock Southern California Nuke Plant San Onofre A30 11:09PM

Site Outage Friday A30 3:49PM

Change Links August 2018 A14 1:56AM

Setback for Developer of SC Farm Land A12 11:09PM

More problems at Shutdown San Onofre Nuke J29 10:40PM

Change Links 2018 July posted J09 8:27PM

More Pix: "Families Belong Together," Pasadena J02 7:16PM

"Families Belong Together" March, Pasadena J02 7:08PM

Short Report on the Families Belong Together Protest in Los Angeles J30 11:26PM

Summer 2018 National Immigrant Solidarity Network News Alert! J11 6:58AM

Watch the Debate: Excluded Candidates for Governor of California M31 5:20AM

Change Links June 2018 posted M28 7:41AM

The Montrose Peace Vigil at 12 Years M22 8:01PM

Unity Archive Project M21 9:42AM

Dianne Feinstein's Promotion of War, Secret Animal Abuse, Military Profiteering, Censorshi M17 10:22PM

CA Senate Bill 1303 would require an independent coroner rather than being part of police M10 9:08PM

Three years after OC snitch scandal, no charges filed against sheriffs deputies M10 8:57PM

California police agencies violate Brown Act (open meetings) M02 8:31PM

Insane Company Wants To Send Nuke Plant Waste To New Mexico A29 11:47PM

Change Links May 2018 A27 8:40AM

Worker-Owned Car Wash on Vermont Closed A27 5:37AM

GUIDE TO REBEL CITY LOS ANGELES AVAILABLE A13 12:39AM

lausd whistle blower A11 6:58AM

Website Upgrade A10 10:02AM

Help KCET and UCLA identify 60s-70s Chicano images A04 8:02PM

UCLA Luskin: Casting Youth Justice in a Different Light A02 6:58PM

More Local News...

Other/Breaking News

Irrémissible, l'inhumanité acquise en héritage S26 6:37AM

Addendum: Benjamin Tucker American Mutualist: Tucker Did Not Advocate Voting in Businesses S25 11:45PM

OUR HOUSE Grief Support Center Celebrates 25 Years with the House of Hope Gala S24 7:10PM

Against the Rent Madness and For a Nonprofit Orientation! S24 11:56AM

Cybermonde, cyberguerre, cyberespace, cyberterrorisme S24 6:35AM

Paraphysique de psychosomatique S22 6:58AM

Chuck Grassley: Women Abusing, Animal Murdering, Illegal War Supporting Criminal S22 2:58AM

Finance Capitalism and the Digital Economy S21 4:45PM

Muselières syndicales, muselières patronales S21 7:19AM

Jeff Bezos, Amazon, The Washington Post, Whole Foods, Etc S21 2:50AM

Why Choose Nut Milk Over Cows' Milk S21 1:01AM

Antrhopocène, le grand effondrement S19 9:53AM

Abolir l'économie S18 11:18AM

The Dictatorship of Corporations S17 5:26PM

18 Lethal Consequences Of Hunting S17 3:13PM

Paraphysique de l'outplacement déontologue S15 6:51AM

Shopping du bashing S14 8:42AM

After Lehman Brothers, Experts Say Global Financial Crisis Can Happen Again S13 8:28PM

“Animaniacs in Concert!” Starring Voice Legend Rob Paulsen S12 9:30PM

Probabilités de fin d'humanité S12 6:49AM

Florida Area of Migrant Farmworkers Denied Right to Construct Health Clinic near NaplesCIW S11 2:57AM

Steer clear of work morality! S09 12:10PM

The Shortwave Report 09/07/18 Listen Globally! S06 11:23PM

August 2018 Honduras Coup update S06 12:28PM

Brett Kavanaugh Filled The 5th Circuit With Execution Judges S06 6:14AM

Augusta Georgia Woman Gets 5 Year Prison Sentence for Writing About Russians Crime Acts S05 8:29AM

Paraphysique de contextualité S05 8:29AM

Crisis Regulation in Global Capitalism S03 3:39PM

More Breaking News...
© 2000-2018 Los Angeles Independent Media Center. Unless otherwise stated by the author, all content is free for non-commercial reuse, reprint, and rebroadcast, on the net and elsewhere. Opinions are those of the contributors and are not necessarily endorsed by the Los Angeles Independent Media Center. Running sf-active v0.9.4 Disclaimer | Privacy