Wednesday, August 24, 2011
You can always count on Greenspan to get it wrong. He's "not worried" about a "double dip," Well, guess what? I'm not worried about it either, because we never got out of the first "dip."
While we're at it, lets stop calling it a "recession" and call it what it REALLY IS:
Namely - A DEPRESSION! We can all thank Mr. Greenspan for getting us here.
I'd also add that Gold fans should be absolutely terrified to know this idiot says it's not a bubble. Greenspan is now (after a more than 600% rise) finally in the camp of being a fan of Gold. As if the guy could identify a bubble. This assclown didn't think the Nasdaq was a bubble as it topped 5000 in March of 2000 and even gave a famous speech on the wonders of Technology only a few days prior to it's topping and subsequent collapse.
As of today, Gold is down over $150 an ounce since he was interviewed for this article (below) posted on Bloomberg. Seems his interview perfectly coincided with the current ALL-TIME HIGH in Gold. Will Gold go higher than the current high? Perhaps, but the odds of that dramatically fell considering this chump now loves it.....
Another great call Greenspan.
Let me just ask again - PLEASE FUCKING DIE!!!!!
Aug 23, 2011 7:28 AM PT
“The euro is breaking down and the process of its breaking down is creating very considerable difficulties in the European banking system,” Greenspan said today in Washington.
Emergency steps such as unlimited loans from the European Central Bank are keeping many banks in Greece, Portugal, Italy and Spain solvent and easing lending by other Europe institutions. Greenspan said a contraction in Europe would hurt profitability and stock values of American companies since Europe is the target market for about 20 percent of U.S. exports and about 20 percent of foreign-affiliate earnings.
A lack of confidence in euro-denominated debt is straining the region’s banks, Greenspan said. “That stuff has always been thought of as the ideal collateral and now it’s getting highly questionable,” he said in a question-and-answer session at the Innovation Nation Forum in Washington.
“The problem is that there is a growing cleavage in the economic and analytical and banking circles as to whether the Euro, which is the crucial issue here, should be 17 countries with very significantly different cultures” regarding the role of government, consumer spending and inflation, Greenspan said.
Asked if the breakup of the euro was one possibility, he replied, “obviously.”
Greenspan also said he is “less worried about a double-dip than most people are but I’ll certainly grant that the odds are rising,” referring to the chance that the U.S. economy will return to recession. “The reason we are so sluggish is the level of uncertainty.”
The economy grew at a 1.3 percent annual pace in the second quarter of 2011, according to the Commerce Department. That followed growth of 0.4 percent in the first quarter, the slowest since the second quarter of 2009, when the economy was still mired in recession.
One gauge of the economy’s momentum, the Chicago Fed National Activity Index, improved to minus 0.06 in July from minus 0.38 a month earlier, the regional bank said yesterday. The index is a weighted average of 85 economic indicators, with readings less than zero indicating “below-trend” growth and average readings below minus 0.7 percent over three months signaling an increasing risk that a recession has begun, according to the Chicago Fed.
Greenspan said Aug. 7 on NBC’s “Meet the Press” that the chance of a return to recession “depends on Europe, not the United States. The United States was actually doing relatively well, sluggish, but going forward until Italy ran into trouble. That destabilized the European system and the crisis reemerged.”
Concern about the government debt of Italy and Spain prompted the European Central Bank on Aug. 8 to begin buying Italian and Spanish assets to lower their borrowing costs, as Europe’s sovereign-debt crisis nears its third year.
A four-week global equity rout has wiped about $8 trillion from companies’ market value as Europe’s sovereign debt-crisis and worsening economic reports in the U.S. raised concern the global economic recovery is faltering. The S&P 500 fell 16 percent from July 22 through the end of last week and its members trade at an average 11.3 times estimated earnings, near the lowest level since March 2009.
The Standard & Poor’s 500 Index advanced 0.9 percent to 1,134.34 at 10:23 a.m. in New York today.
“What has been the greatest thrust coming out of the recession has been the extraordinary rise of stock prices in the U.S.,” Greenspan, 85, who was chairman of the central bank from 1987 to 2006, said today.
No Gold Bubble
Greenspan also said that he did not think gold, which reached a record above $1,900 an ounce this week, was in a bubble.
“Gold, unlike all other commodities, is a currency,” he said. “And the major thrust in the demand for gold is not for jewelry. It’s not for anything other than an escape from what is perceived to be a fiat money system, paper money, that seems to be deteriorating.”
After leaving the Fed, Greenspan founded the consulting firm Greenspan Associates and has been a consultant or adviser to Deutsche Bank AG, Pacific Investment Management Co. and hedge fund Paulson & Co.