think Alan Greenspan is somehow responsible for the financial crisis… Thoughts??
To assign blame to one individual is assinine That being said he was and is dead wrong about the effect the GSE’s/CRA/govt policy had on subprime as an asset class…
No one person was to blame for the crisis, but low rates for an extended period of time was definitely a contributory factor.
I think its the rating agencies
I’m blaming NASCAR.
Everyone who had a hand in shaping fiscal and monetary policy in the last 20 years is partially to blame, which includes Greenspan.
He definitely shoulders part of the blame. Perhaps not as much as people would like to think…
I blame the community reinvestment act.
Fed/Greenspan was responsible for setting short term rates while mortgage rate was driven by long term rate. However, due to the invention of adjustable rate financing, mortgage was indeed affected by short-term rate. Fed/Greenspan definitely cannot brush aside all blames for causing the financial crisis.
Barry Ritholz’s book Bailout Nation is pretty good. There is plenty of blame to go around; however, it’s hard to think of any one person that should get more of it than Alan Greenspan. Bush was President, but he doesn’t control the Fed’s actions, and he isn’t smart enough that he should have known better. Banks were blameworthy, but they each contributed just their part to the crisis. Unrealistic homeowners too. Sometimes I feel a bit sorry for Greenspan - it sounds like he just believed that markets could control themselves through incentives, and now must spend his waning years thinking that he might have been the guy best placed to avoid this crisis, and failed to see it.
Im curious if anyone actually knows what CRA does or how it works?
It wasn’t that long ago when Greenspan was mentioned in the same sentence as Paul Volcker. His reputation drops faster than the stock market.
BizBanker Wrote: ------------------------------------------------------- > Im curious if anyone actually knows what CRA does > or how it works? I was being facetious.
Oh it wasnt directed at you. I am just curious that when people want to blame a govt program that has been around for over 30 years with no ill effect or that really only applies to banks that want to expand if they actually know what they are talking about. My experience is that 99% of people dont and I have to get tested on it so I do. If you are going to kick people who are down, dont you want to make sure that you are at least justified?
Anthony Mozillo’s spraytan is better than John Boehners
What financial crisis? I’m rich b!tch!
eureka Wrote: ------------------------------------------------------- > What financial crisis? I’m rich b!tch! How rich are you, bro?
Read “Greenspan’s bubbles”.
Greenspan’s low interest rates were partially to blame. The inflation that occurs through expansionary monetary policy was absorbed by leveraged assets; real estate. Another significant piece is the Asian savings glut that provided an oversupply of capital contributing to the overleveraged economy of the aughts. Although I do believe that GSEs/CRA may have played a secondary role, as a libertarian leaning conservative I get so sick of people such as Sean Hannity and other panderers preaching that they played a primary role. William F. Buckley must be spinning in his grave.
BizBanker Wrote: ------------------------------------------------------- > Oh it wasnt directed at you. I am just curious > that when people want to blame a govt program that > has been around for over 30 years with no ill > effect or that really only applies to banks that > want to expand if they actually know what they are > talking about. My experience is that 99% of people > dont and I have to get tested on it so I do. If > you are going to kick people who are down, dont > you want to make sure that you are at least > justified? Biz what is CRA exactly, how do bank use it? Please elaborate. Thanks