It wasn't me!

Greenscam.... go away.

This guy is still making money by selling books and giving speeches. Sheeple still adore him.

unreal....(Greenscam.....good one)

What a joke.

He doth protest TOO much! Enough with the GreenSPAM!

I really wish this filthy scumbag would just die already since he won't go away and hide his head in shame like he should....

I think you are trying to put way too much of the blame on him when the fed really had no control over the mortgage market. It is the market, greedy and un-catious investors, poor judgment on th bond rating agencies, an yes, fraud from us lenders, brokers, and borrowers. It is the effects of a free market.

This is a long quote but one worth reading.

Greenscam claims he did nothing to cause this mess,

Yet here is a quote from Alice Rivlin, one of the Fed Governors during Greenscams tenure, and as went the opinion of the chairman of the fed, so too went its bootlicking governors-

From Nightly Business Report, Sept 17, 2007
Alice Rivlin's remarks:

Sub prime lending has enabled about 12 million households, mostly lower income and minorities to buy homes, most of these borrowers did not qualify for regular mortgages but at least 80% are making their payments and enjoying the benefits of home ownership. Broad home ownership benefits the whole community and lenders must be compensated for the risks of lending to less credit worthy borrowers but they should not be allowed to take advantage of unsophisticated borrowers by offering them low teaser rates and then locking them into higher rates with big pre payment penalties. Lenders should be required to make certain that borrowers understand terms and risks. Hardly any predatory lending was done by banks which are reciduously (? Not sure of the word she used?) regulated and required to behave responsibly but exceptionally low interest rates and seemingly endless increases in housing prices tempted other mortgage lenders operating under looser regulation into unscrupulous practices. We must have a consistent set of rules that apply to all mortgage lenders. These rules should allow compensation for risk but keep predators from preying on those least able to protect themselves.

Translation
Sub prime lending has enabled about 12 million households, mostly lower income and minorities to buy homes-
(no, the mortgages allowed 12 million households to get mortgages to get into homes, which means if these borrowers can‘t make the monthly mortgage payment, then the house goes to the bank. Jingle mail anyone?)
most of these borrowers did not qualify for regular mortgages but at least 80% are making their payments and enjoying the benefits of home ownership.
-(until the sub-prime and Alt-A loans reset, then we will see who remains a homeowner or not.)

Broad home ownership benefits the whole community
(the whole community=lenders, Real estate agents, builders, furniture stores, as to whether it helped the neighborhoods depends on what kind of people moved into the homes, I.e. meth lab operators, pot growers, white trash, etc.)
and lenders must be compensated for the risks of lending to less credit worthy borrowers but they should not be allowed to take advantage of unsophisticated borrowers by offering them low teaser rates and then locking them into higher rates with big pre payment penalties.
(Why not do this with credit card companies too?)
Lenders should be required to make certain that borrowers understand terms and risks.
(Most buyers, coached on my real estate people, were told buy now or be priced out forever, real estate can only go up, you can always refi, think of the HELOC, etc. Most buyers couuldn't wait to get their 'homes', fix them up and then flip them for big money.)
Hardly any predatory lending was done by banks which are reciduously
(? Not sure of the word she used?)
regulated and required to behave responsibly
(Banks required to behave responsibly? And just how many billions have been lost on this sub prime fiasco? How many billions of tax dollars are going to be needed to clean up this banking mess caused by these 'banks required to behave responsibly'?)
but exceptionally low interest rates
(and WHOM pray tell lowered the interest rates to the lowest levels in decades, Mrs. Fed Reserve Governor?????)
and seemingly endless increases in housing prices
(And which Fed Chairman talked up the housing market as though he was a cheerleader for the NAR may I ask? )
tempted other mortgage lenders operating under looser regulation into unscrupulous practices.
(The bad players were out there to begin with, only now with housing in meltdown are the fingers being pointed and the markets tanking.)
We must have a consistent set of rules that apply to all mortgage lenders. These rules should allow compensation for risk but keep predators from preying on those least able to protect themselves.
(and will this be done against the credit card companies, which charge double digit rates, may I ask?)

As I said before, as went the fed chairman so too went the fed governors.
History will NOT be kind to these vermin, and there is nothing they can say or do to prevent that.

In case anyone is curious as to what Alice Rivlin looks like, imagine Greenscam in drag, now there is a picture you won't be able to get out of your head for days.

Jeff Dinkin ... you must be kidding ... Greenspan set the tone????
Well, interest rate was kept too low for too long (and effectively making lending money free due to near 0% real interest rate).

But how you get from keeping the interest rate low to ‘set the tone’ by encouraging to use of excessive leverage to do highly speculative lending without ever assessing the credit quality and sell the same repackaged loans over and over … is beyond me?

Sounds awfully lot like someone saying “it wasn’t me … but he started …” and it has never been forbidden to use your common sense and logic judgment …

Here is another person who saw through Greenspan's so called superiority-

http://www.foreignpolicy.com
/story
/cms.php?story_id=4278&print=1

http://www.foreignpolicy.com/story/cms.php?story_id=4278&print=1

Greenspan’s Follies

By Stephen S. Roach

Quote:

Greenspan’s handling of the housing bubble is the smoking gun. The Greenspan mantra is that markets know best—that central bankers should not attempt to override the verdict of millions of market participants by declaring that an asset bubble has formed. After all, there are the costs to economic growth to consider if monetary policy is used to deflate such bubbles. And why should any modern economy have to incur those costs? After all, goes the script, the authorities always have the wherewithal to clean up any post-bubble mess. Maybe not. This time, the mess is almost beyond the realm of comprehension—most likely a good deal larger than any growth that might have been foregone had the U.S. housing bubble been handled more judiciously.

Yet the problem has never really been the bubble in the narrow sense of the word. One of the weakest links in the Greenspan defense is his fixation on whether a serious bubble was forming in America’s housing market. Never mind his earlier arguments that housing markets were local, not national, and that it was highly unlikely that home prices could ever fall nationwide.
Whoops.
Never mind also his equally irrelevant point that there were lots of housing bubbles in the world at the same time, and that America’s property market excesses didn't look so bad by comparison. Everyone’s doing it, so it’s not the Fed’s fault. Right?

Wrong. The trouble with America’s housing bubble was never its comparison with Ireland. The core of the problem lies in the distortions that asset bubbles created on the real side of the U.S. economy. Courtesy of the most rapid rates of sustained U.S. house price appreciation in the modern post-World War II era, along with innovative financing techniques that allowed American homeowners to extract equity with ease from their humble abodes, the new age of the asset-dependent consumer was born. Net equity extraction from residential property—ironically, derived from a statistical framework developed by Alan Greenspan, himself—surged from 3 to nearly 9 percent of disposable personal income in the first half of the current decade.

And so it went. Increasingly supported by the confluence of both property and credit bubbles, U.S. consumers spent well beyond their means. Personal consumption climbed to an unheard-of 72 percent of real GDP in 2007—a record for the United States and, for that matter, for any leading economy in modern history. At the same time, household debt soared to a record 134 percent of disposable personal income. America certainly achieved the rapid growth that Greenspan felt the body politic wanted. But it was growth based increasingly on fumes.

.............What Greenspan missed repeatedly over the years—
and still misses today—
are the corrosive impacts this bubble had in fostering the imbalances and excesses of an asset-dependent U.S. economy. Unprecedented consumer leverage is only part of the problem. So, too, is the failure of an aging U.S. population to save precisely when it needs to prepare for retirement. Global imbalances are also an outgrowth of this era of excess—underscored by America’s massive external deficit and, by the way, the protectionist fires it stokes. Alas, these fault lines were made all the deeper by the Fed’s regulatory laxity in an era of unprecedented financial innovation—a laxity made all the more dangerous by the cheap borrowing costs of a Fed-induced credit bubble. This dangerous combination undoubtedly played a key role in fueling voracious investor demand for opaque and increasingly toxic financial products.

It didn't have to be this way.
Just saying no to asset bubbles was always an option.
A variety of anti-bubble tools—
the bully pulpit of jawboning,
more disciplined regulatory oversight,
and, ultimately, a tighter monetary policy—could have prevented disaster.

Bottom line - whether Greenspan is "evil" or dumb is irrelevent. The truth is that his fixes did harm in the long term and that he was not the golden boy that many of us thought he was for so many years. Unfortunately - it will take the equal of a financial Stephen Hawking to fix our complex system. That person probably does not exist.

DKS

Smile - Life is Good

Wow man, 2 months without a toon. Come on Kahuna, certainly with the massive move in the markets on Friday (which SHOULD continue Monday without massive rigging) should provide some material.......

Still more from a retired fed head (not greenscam, but just as bad)

It is long but worth reading...
From Nightly Business Report, Monday 9, 2008
From Alice Rivlin, former Federal Reserve Governor

Libertarians claim that requiring motorcycle helmets poses moral hazard because it invites reckless biking.
Free market purists think the federal reserve's rescue of Bear Sterns invites reckless investment banking.
Never mind that the shareholders of Bear feel like the biker whose helmet saved him from brain injury but not from broken legs and a destroyed Harley.

These same people are now saying that putting public money at risk to help families facing foreclosure will encourage the reckless at the expense of the prudent.

But society shares the blame for not regulating the lax lending standards and high pressure tactics that led home seekers to borrow so much.

Moreover foreclosures are a contagious disease destroying property values even of prudent neighbors.

If help is not forthcoming the foreclosure disease will spread more rapidly and prolong the pain.

All public policies involve trade offs between conflicting values. Policy makers must
weigh the benefits of helping distressed homeowners against the risk of encouraging future imprudence.

This moral hazard problem is tougher than motorcycle helmets, but I believe that we should mitigate the contagion and buy time to fix the fundamentals that society got wrong.”

Translation-

“Libertarians claim that requiring motorcycle helmets poses moral hazard because it invites reckless biking.
Free market purists think the Federal Reserve's rescue of Bear Sterns invites reckless investment banking.
Never mind that the shareholders of Bear feel like the biker whose helmet saved him from brain injury but not from broken legs and a destroyed Harley.
(You buy stocks with no guarantees that said stocks will go up in value or hold their value, you pay your money you take your chances.)

These same people are now saying that putting public money at risk to help families facing foreclosure will encourage the reckless at the expense of the prudent.
(She invokes the image of the poor homeowner losing their house, completely ignoring the flippers, the Trump wannabes, the house buyer who bought one year waiting to cash out big down the road, etc.)

But society shares the blame for not regulating the lax lending standards and high pressure tactics that led home seekers to borrow so much.

(Society as a whole had NOTHING to do with not regulating the lax lending, that was the job of bank regulators, the chief bank regulator being the Federal Reserve, an institution Mrs. Rivlin was a governor of. )

Moreover foreclosures are a contagious disease destroying property values even of prudent neighbors.
(Property values that were artificially high due to all of the fog a mirror lending.)

If help is not forthcoming the foreclosure disease will spread more rapidly and prolong the pain.

(The pain will go on in spite of the best help offered, since we are talking about a housing problem that would cost billions to fix, money the US doesn’t have. )
All public policies involve trade offs between conflicting values. Policy makers must weigh the benefits of helping distressed homeowners against the risk of encouraging future imprudence.
(Future imprudence will happen no matter what the government does, remember dot coms anyone? The only way to prevent ‘future imprudence’ is to outlaw greed, try passing that law anywhere in the world.)

This moral hazard problem is tougher than motorcycle helmets, but I believe that we should mitigate the contagion and buy time to fix the fundamentals that society got wrong.”
(Society as a whole didn‘t create this mess, the banks that sold off the loans to investors, the ratings agencies that graded this junk as AAA, used house sales people pumping houses as a get rich quick scheme, house appraisers that went along with it, etc. It wasn‘t society as a whole who caused this, it was the underbelly of society that deserves the blame.)

Hello

G'night