Letters to the Editor
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Economy
Andrew - did you catch Paul Volcker on Charlie Rose last week?
Priceless.
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Short-term focus
Recessions come and go; the ability of governments to do anything about them is limited. With those economic cycles (and a major cause of them) will be the usual cast of reckless lenders, reckless borrowers (and, in the housing crisis, they weren't Wall Street types, they were millions of Joe and Jane Averages borrowing to buy property in a game of pass-the-parcel) financial engineers, insider traders and other assorted crooks. Historically, the financial engineers have always managed to stay one step ahead of law enforcement; I recommend reading a book or two about the junk-bond shenanigans of the 1980s for an example.
But, despite all that, the American economy has continued to grow faster than most other developed countries over the past couple of decades. So why hasn't that made the average American feel richer? What's been screwing 95% of the American population over the past couple of decades is that the richest 5% have been creaming the benefits of economic growth for themselves. Most of that is going to the richest 1%, maybe even the richest 0.1%. And that has had a far more profound effect on the financial security of the average American than the ephemeral rumblings of the financial markets.
Putting up the tax rates on the most wealthy, and using the proceeds to finance (for instance) single-payer health, would be the most profound way to redress this balance and improve the financial security of the vast majority of the American populace.
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Greenspan? good god NO!
A good portion of the mess we are in can be layed directly at the doorstep of Alan Greenspan. Why on earth would she want him to have any say in this now?
Greenspan loved all the Bush tax cuts, and didn't much mind the increasing deficits until after he retired.
Greenspan had oversight authority on the banking industry, and could have inacted regulations on the sub-prime mortgage lenders, but didn't.
Greenspan could have cooled the housing market by raising interest rates, but didn't do that either.
What does she think Greenspan will do now?
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Seriously.
She wants Greenspan on an investigation panel? She wants the people responsible for the disaster we're mired in to investigate how we got there?
Oy.
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well gee, since Greenspan was there when Bill Clinton gave us the best economy
since WWII, I'd say he just might be worth listening to.
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Seeking advice from Greenspan- lady are you nuts????
I think HRC wanting Greenspan's advice is probably the best example of somebody stuck in a time warp unable to tell the difference between good economic advice from bad and a little girl reading a poem from sniper fire.
Greenspan has been a fraud from the day he became Chairman of the Fed. As a private economist his track record was not much better. He has basically been a shill for Wall Street. Don't take my word for it do your own research- at every critical turning point he was wrong. In 2000 just before capital spending fell of a cliff Greenspan said he saw no sign of a slow down, or after the Asian crisis "it defies belief to believe that the US will remain an island of stability" wrong!!! the following quarters the US economy had some of its strongest growth period.
Like Bill Clinton Greenspan was the beneficiary of some mega global trends- China with its vast pool of cheap labor getting incorporated into the world economy, the internet, fiber optic cables and vast expansion in computing power. This was period similar to boom experienced with the introduction of rail roads and then electricity. Even he couldn't screw it up then but we are paying the price now for a Fed Chairman who rather than remove the punch bowl (as his predecessors would have done) spiked instead- party on!
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help is on the way?
Barney Frank! Man.
It's simple; like he says. Capital reserves required! For all these weird financial deals that no normal person can understand anyway That's it. Just like the Fed requires for banks.
If I understand correctly, Greenspan actually had the legal authority to stop this kind of gambling if he wanted. But he didn't.
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Greenspan = cause of problems
Greenspan created this mess. He cut the interest rate to 1% in 2001. Then he systematically deregulated the banking industry. Then the housing boom happened. Then he refused to regulate CDO's based on the boom. Then the deregulated doomed loans died. Then Greenspan left. Putting him on top of the economic council is like putting Condoleeza Rice on the 9/11 commission. Condoleeza's gross negligence in ignoring all the warnings from Richard Clarke brought us 9/11, Greenspan's refusal to regulate brought us the financial sector crash. Clinton has shown her true colors today. Greenspan is anything but non-partisan, he is the very height of free market fundamentalism.
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do it!
I hope this group is put in the same room, just to see the 80 year old Volcker leap across the table and strangle Greenspan to death.
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HIllary late
Obama gave this speech over a week ago. Isn't she a littl late.
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It sounds like a typical political sham
Tell the voters you're going to "do something", but select people who are pretty much guaranteed to avoid upsetting Wall Street's happy greed party.
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At least it's a plan.
What does Obama bring? "Trust me to hope the hopeful hope, onward to the beige future!"
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Problem is|was not borrowed money, but cheap borrowed money
The real core of the problem, as Krugman and others have tirelessly pointed out, has been the rise of an essentially unregulated "shadow banking system" of hedge funds and investment banks that used borrowed money to bet without restraint wherever they saw the chance to turn a profit.
From my armchair investor perspective, it's all about the spread (e.g. difference between cost to borrow and return on investment). And Greenspan is the dude that flooded our monetary system with lots of cheap money that got leveraged into mortgage and other derivative products. Huge profits were made, for awhile. If borrowed money is expensive, then more care is going to be taken. Now that money is getting cheaper again, everything is going to be just fine, right?
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If policy positions were posted on the internets,...
but no one covered it, does it still exist? Surprisingly, yes!:
http://www.barackobama.com/issues/economy/
And yes, "blank", Obama gave a speech about it last week: YouTube-it, yourself, if you're not too busy..