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

Marshall Tuck’s racist dog whistle O27 5:01AM

Marshall Tuck’s ethnocentrism contradicts Californian values O27 4:32AM

Contra Costa-Hawkins O25 3:48AM

Debunking Some Anti-Prop 10 Propaganda O12 6:56AM

Why Should California Choose De Leon Over Feinstein? O10 9:55PM

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

More Local News...

Other/Breaking News

Socialism in American English N20 12:04PM

Noske, noskisme réactualisé N20 11:29AM

Oprah Please Stop Selling Dead Animal Pieces N20 3:32AM

Down In Smoke SF N20 12:03AM

Credit Mr. Richard Enos with outstanding penmanship N19 6:08AM

Master list=====47 million american on foodstamp List State plus Federal N18 8:21PM

Cholesterol Medicine Causes Alzheimers N18 7:40PM

Lucifers Banker N18 7:38PM

Paraphysique du scientisme N18 9:19AM

USDA Withholds Names Of Turkey Companies Spreading Salmonella N17 7:51PM

Hebron, Ben-Gurion, and UNESCO N17 6:00PM

What Can Destroy Enclosure? N17 1:47PM

Please Help Mississippians Vote For Mike Espy On Nov 27th N17 7:42AM

The Incredible & Brilliant Work of Dr TOMO SHIBATA N17 5:19AM

October 2018 Honduras Coup update N16 9:22PM

Profit de guerre, guerre de profit N16 11:58AM

“Animaniacs in Concert!” Starring Voice Legend Rob Paulsen Heads to Seattle N15 7:22PM

Paraphysique du prodrome oukase N15 12:39PM

President Trump: Hurricane Relief Should not Pay Puerto Rico Debt N14 8:54PM

94 Of Rick Scott's, Brian Kemp's, the Mississippi GOP's & Other Republican Campaign Crime N13 9:42PM

30 Of Brian Kemp's Felonious Racist Vote Suppression Crimes N13 8:42PM

Help translation of From Islam To Womanism book on IndieGoGo N13 12:04PM

COP 21, 25, 32, de l'écocide organisé N11 11:45PM

fbi & fmj are ' Lord of the Flies ' N11 8:26PM

Parangon d'une grande infestation N11 12:03AM

Video: Beautiful Country Burn Again, 39 min N10 10:19PM

OBAMA WERE POW'S LEFTBEHIND IN AFGHANISTAN IRAQ AND LIBYA N08 7:57PM

OBAMA WERE POWS LEFT BEHIND IN AFGAHNISTAN IRAQ AND LIBYA N08 7:29PM

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