Generally, we don’t like to gloat too much here. However, for years on “The Money Show”, you’ve heard us say that Fed head Alan Greenspan was not the so-called great economic “Maestro” most everyone else seemed to think he was, and in general, was not doing a good job at all. Well, it now appears others are starting to see the light.
At a recent forum at Suffolk University Law School in Boston, U.S. Representative Barney Frank (as reported in the Tuesday, May 20th edition of the Boston Herald) had the following tidbits to say about Mr. Greenspan and the mortgage industry/credit meltdown:
· “I believe that if the Fed under Alan Greenspan had issued the regulations that are now being promulgated, we would have much less of a crisis.”
· “To Greenspan, you had two choices – (raise) interest rates drastically and take down the whole economy in the process, or let (market excess) go on.”
· “Congress gave Greenspan [under legislation passed in 1994] the authority to regulate mortgages – but he wouldn’t do it…He would say ‘Oh, the market knows better.’ Well, the market clearly didn’t [Respresenative Frank's empahsis] know better.”
· Additionally, representative Frank contrasted Greenspan to current Fed Head Ben Bernake, who has begun and plans to continue to use the 1994 law to regulate the mortgage industry. As Representative Frank put it, “Bernanke is kind of the ‘un-Greeenspan'.”
In short, what Representative Frank said (and, it appears, others are beginning to realize) about Alan Greenspan in general and the regulation of the mortgage industry in particular is what we’ve been saying about Alan Greenspan on “The Money Show” for years.
Alright. Maybe we do like to gloat, just a little.