Greenspan admits to not being superhero!
October 24, 2008
It looks like Alan Greenspan is finally coming out of the closet and admitting he is not the superhero we all thought he was for so many years. As of today he is confessing that he placed far too much faith in the self-correcting power of free markets and had failed to anticipate the destructive power of wanton mortgage lending.
“Those of us who have looked to the self-interest of lending institutions to protect shareholders’ equity, myself included, are in a state of shocked disbelief,” he told the House Committee on Oversight and Government Reform.
Many people now believe that had Greenspan not held interest rates down for so long we wouldn’t be in the mess we’re in today. Low interest rates caused a feeding frenzy in the banking industry where people not otherwise qualified to buy a home were now finding it utterly irresistible. While I’m not sure any one individual can be held 100% accountable I do find it fascinating how we all love to point our fingers at one another. What ever happened to personal accountability?