Greenspan and the Housing Bubble
Must read.
(counterpunch.org): It’s strange that Alan Greenspan hasn’t been blamed for the housing bubble. After all, he set the “easy money” policies that put the whole thing in motion and he’s the one who should be held responsible when it goes up in smoke.
Tags: Consumerism, Politics
August 19th, 2005 at 12:21 pm
Superspan has left a big mess for the next Fed chair. The new bankruptcy bill will make the fallout bad as well. Making things worse is that our Government is using non-Gaap accounting that not even Enron would have tried. My money is on Hyperinflation at some juncture.
“With the exception only of the period of the gold standard, practically all governments of history have used their exclusive power to issue money to defraud and plunder the people.”
Friedrich A. Hayek (1899-1992) Austrian Economist, Author and 1974 Nobel Prize-Winner for Economics
The quotes are from the FT.
“Another death knell: the American consumer is overextended and, short of selling his soul, has few new avenues open to increase his spending ability. The average US family spends $1.22 for every dollar it earns, has 13 credit cards and $9,312 in credit card debt – twice as much as 10 years ago, according to CardWeb.
Americans have taken $1,600bn out of their homes through equity loans since 2001, according to Goldman Sachs. The “housing ATM” that has kept many Americans living beyond their means is just about tapped out. With all this easy credit, it is no wonder consumers have avoided a recession for 14 years.”