Greenspan On Crisis: 'Not Bad'

Former Federal Reserve chairman Alan Greenspan oversaw policies that contributed to the worst economic catastrophe since the Depression. But the morning after the stock market crashed, he reportedly didn't feel too bad.

Speaking publicly at New York University, Greenspan recounted what was going through his mind one morning in September 2008, after the Dow Jones Industrial Average dropped nearly 7 percent.

According to Washington Square News:

"The morning after we learned of the news," he said, "I was able to look myself in the mirror and say, 'Hey, not bad.'"

Greenspan kept interest rates low in the decades leading up to the crisis, helping promote first a bubble in technology stocks and then a bubble in real estate assets. With money flowing cheaply, investors scrambled to buy products that later proved dangerously risky.

Even when other Federal Reserve officials expressed concern over the fast-moving economy, Greenspan held firm.

The former Fed chairman has also been a strong supporter of derivatives, the financial instruments that worsened the financial meltdown.

In testimony before the Financial Crisis Inquiry Commission last year, Greenspan said he was "right 70 percent of the time, but I was wrong 30 percent of the time and there are an awful lot of mistakes in 21 years."

On that morning in September, the full extent of the crisis hadn't yet unfolded. Few people predicted just how severe the economic fallout would be.

Comments

[Matt12]

03:37 PM on 02/21/2011

He should be in jail, deprived of a microphone, TV camera as well as conjugal visits with NBC's Andrea Mitchell (assuming that is possible)

[Muttley88]

08:20 AM on 02/21/2011

Total non sequitur, but the invasive advertisements are making this site almost unbearable. I already come here much less than I used to, and every time I have to click away an ad screen I tend to want to click away to somewhere else altogether....

[edejan]

03:27 AM on 02/21/2011

Been watching "The Tudors" lately. If Greenspan had lived in that type of society, he would have been summarily beheaded after a nice stay in the tower.

[charperz]

02:02 AM on 02/21/2011

this SOB contributed to the worst economic catastrophe since the Depression

and he say is not bad ">O*(^%$@&(())_(

[schatsie]

09:28 PM on 02/20/2011

Read Ravi Batra's book The Greenspan Fraud....and the Big Con.....This man is sickening morally and mentally....

[american-dolt]

05:59 PM on 02/20/2011

People like Greenspan are very dangerous to our very existence. Deport him.

[collettethehedgehog]

05:03 PM on 02/20/2011

If he'd had the self-awareness to look in the mirror and say Mea Culpa-he wouldnt have made such a mess of the economy. Ayn Rand would be proud. I remember reading a Life magazine article on the Rand Society, early 60's-I think) and the reporter said when the meeting was over and everyone headed to the elevator - the most telling thing was how no one waited or stepped aside for anyone else to get on. I've often wondered if one of those fellows was a young Greenspan.

[cigi]

04:59 PM on 02/20/2011

Greenspan's money policies took interest rates up in the late 1990s right before Brainless Bush stole the first election of the new century. He then lowered them to 0% for the Banksters and thus began an eight year era of greed and avarice by all in the financial markets. Cheap money let the workers who were going sideways in their wage increases to feel they had money when they didn't. Many took risks in the housing markets and bought more than they could afford. In 2003, when my husband and I both were closing in on 60, and decided to build a home, we were told by our lender that we could qualify for a home of $485K...nutz! We knew we weren't good candidates for a loan of that size and we built a nice home for $197K and put down 25% to make sure we DID NOT get upside down in our mortgage, if a downturn were to come. We also paid an extra $100 to priniciple monthly for the last 8 years. We are now downsizing and while we won't make a bundle off of this house, we will be able to make back our equity in our home and about $28K in profit. Since we are now in our 60s we plan to downsize and not get sucked into any payments we can't sustain. A home is a roof over your head, not a piggy bank. Too many were duped by realestate/banking cons.

[Christopher Hull]

04:58 PM on 02/20/2011

I vehemently disagree with my fellow posters who want to see Mr. Greenspan in jail. The end of a rope is where he belongs.

[sophiemaki]

02:54 PM on 02/20/2011

how can he look at himself in the mirror?

[Mike Anton Bidner]

05:31 AM on 02/22/2011

No reflection, I'm guessing...

[jwilson1]

12:37 PM on 02/20/2011

NERO

[AbeMartin]

12:33 PM on 02/20/2011

Shut up, Alan.  Your arrogance as Federal Reserve Chairman made the ongoing economic crisis much worse than it needed to be.  Please stay in your fancy co-op in Manhattan.  Let your wife, Andrea Mitchell, earn her living.  Play your saxophone and clarinet if you get bored.

[IgnoranceIsStrength]

12:15 PM on 02/20/2011

The Host should of asked Mr. Greenspan if he liked his Government health-care.

[sophiemaki]

12:19 PM on 02/20/2011

and his pension and ss.

[bmac8]

01:38 PM on 02/20/2011

He wouldn't care. This guy was the Chairman of a private company that the U.S. allows to PRINT MONEY whenever it wants, without any oversight!

[schatsie]

09:30 PM on 02/20/2011

He probably did a Geithner and did not pay SS taxes for this entire life.....

[byoungusa]

12:15 PM on 02/20/2011

Why would Greenspan not be feeling pretty good? His entire philosophy is to bring down every govt. and rule the world through capitalist, oligharcy's, JUST LIKE HAPPENED!
Nothing like a plan coming together Greenspan, " Hey,Not too bad." Game over...