Quote:
Originally Posted by sterlingice
Is there some point where we can stop with the Saint Greenspanning and show that he set up a lot of what is coming to fruition right now? Or has that already started and I've just missed it?
SI
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I think it's a case of Greenspan getting way too much credit for the market when it was booming and way too much blame now. I really don't think there was anything Greenspan did that got this going.
The only complaint you could lodge against Greenspan is that he kept rates too low for too long. I don't necessarily agree with that.
From my experiences and observations, the problem has been that there has been too much investment money chasing loans. Banks were lending money across the board to people who shouldn't have been getting the loans because they had plenty of money. There was a reason BS was buying so much mortgage debt. There was a demand from investors. This applies to other types of lending as well. There were too many investors looking to buy debt.
I'm not sure economic policy would have addressed that. I do know there is a perception among some people even now that the Fed, the Administration and Congress have been slow to react to the problems in housing because they want money out of housing and bonds and into the stock market. Not sure I agree with that either, but I'm surrounded by people who believe that.