Greenspan Says I Still Dont Fully Understand What Happene
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- Опубликовано: 22 окт 2008
- Former Fed Chairman Alan Greenspan has been identified as a prime culprit in creating the conditions for the financial crisis, in particular for opposing greater regulation and fostering a housing bubble. Today, Greenspan is getting his turn on Capitol Hill. And this time, he's speaking in terms we can all understand: admitting some responsibility, while trying to deflect ultimate blame.
www.propublica.org/article/gre...
Greenspan didn't understand that Wall Street only cares about the short term and he didn't understand that interest rates determine asset prices
what you don't understand is he's lying. the financial crisis was by design. jesus dude. get an education
@@RobertMJohnson exactly...he probably owned tons of homes he bought in the 80s, sold them, then switched to credit default swaps despite not being allowed to do this as the chairman of the fed...this was fucking intentional
Bob, isn't it ironic that the people responding to you under a video titled, "I Still Dont Fully Understand", don't fully understand your point or what Greenspan was saying?
You're right, on both counts. Wall St was incentivized, via big bonuses, to loan to risky debtors, and interest rates are indeed a component of price setting, because the cost of credit is reflected in the cost of all goods and services.
He essentially says here that the flaw he found in his ideology was that people are greedy and selfish.
This is who was running our monetary system for decades.
Lol right
That's not what he said.
@@kevinswift8654 Not in so many words. But that is what it comes down to. ‘I thought that managers would act in the self interest of their shareholders’, ie. ‘I didn’t think they would be so self interested and greedy.’
@@brendencarlson5220 I don't remember the video exactly but I thought he was talking about free markets' ability to regulate themselves.
This idealist, this bookworm, was basically saying he overestimated human nature. He assumed the corporate guys would take care of shareholders... he had a poor understanding of people
Just as they all do. They once were people until they became a politician.
Right, it's called self-interest for a reason. It doesn't take into account the interests of others...
It wasn't something he did by accident
It's a cover and an oversimplification. He was acutely aware that the model was flawed, but he was simply averse to any kind of state interference at all. He hit a dead end where he'd have to do something he fundamentally disagreed with to solve the problem, and so he chose inaction instead and let the problem fester and compound on itself. He told us it wouldn't work and ignored the problem. That's how 2008 really came about, due to the inaction or regulators to prevent a runaway market.
It is essentially the opposite you all above write about... The opposite
Gotta wonder what Ayn Rand would have thought of her little protege had she seen him then
Daniel Ryan Surely you know that Any Rand would have been found catching the last plane off of the sinking ship to flee to a land that had never heard of her, where she could blow smoke once again.
+beaconmike .. Alan Greenspan wouldn't exist if it were up to Ayn Rand. A federal reserve chairman and board of governors with complete control over our money supply and interest rates do not exist under a capitalist system. These are socialist institutions. A Sub Prime mortgage crisis wouldn't exist under a capitalist system because a sub prime mortgage wouldn't exist. These exist only through the coercion of the state.... in our case through the government created entities of Fannie Mae and Freddie Mac and other legislation and banking regulations aimed at coercing banks to originate risky loans. Don't blame Ayn Rand blame Karl Marx or blame John Maynard Keynes or blame the Democrats that gave us the central bank and Fannie and Freddie.
+greg goodale Exactly.
+greg goodale I get it. You have studied the world's economies and that I am respectful of, but for the average joe like me, we associate Republicans with 'Free Markets' and (many people now) associate Democrats with 'Socialism'. My point is this. If you are trying to tell me that we should be labeling people like Bernanke, Paulson, Greenspan and Geithner as Socialists, and that, by definition they are not attempting to practice 'free markets' than that would be news (I think) to most Americans as well as Bernanke, Greenspan, Paulson and Geithner. And if you are trying to suggest that Ayn Rand did not stand for 'free markets' that would be news to me also. But I understand that on paper you are probably correct, but in reality, I don't think that Grenspan would agree with you one iota. You know, there is a difference between theory and reality don't you?
beaconmike Bernanke, Paulson, Greenspan and Geithner are a branch of socialist they are Corporate Socialist. Alan Greenspan may disagree or agree on him being a corporate socialist. Going back to your reality and theory point, which he is a corporate socialist in reality.
I am a free market advocate. Greenspan is not. Monetary control (the Fed) and free markets are about as opposite as you can possibly get.
finally someone who gets it
" I found a flaw " quote reminds me of the limerick :
A flea and a fly in a flue
Were trapped, so what could they do ?
Let us flee, said the fly
Let us fly, said the flea
And they flew thru a flaw in the flue
😂😊
There is something heart warming to hear Greenspan admit that he was wrong about conservative economics for over 40+ years hahaha
you've been duped
He did, but did some backtracking to protect his idealism. SHOCKED he was! The market still knows best. Don't pay attention to these big exceptions in front of us. Just listen to my words!
Greed is good. That is capitalism in a nutshell. We take the bad greed and run it through the alchemy of capitalism, and it all turns out for the good.
The reason Greenspan was shocked is all those years drinking the Kool Aide. He thought the greedy wouldn't kill the goose, which laid the golden egg, but these market actors do. There is a history of that.
6:35
On another occasion, I remember him asking why the banks would do that to themselves. He was asking rhetorically, I believe, kinda thinking out loud, but this question reveals the problem. The bank is NOT a person interested in preserving its life. It is run by many individuals who, according to capitalist theology, are supposed to be return maximizers like all actors in the system. For the greedy maximizer, it is better to get theirs sooner rather than later.
Those managers and CEOs knew the system was headed for collapse. It would be difficult to stop it as an individual, and if the bank you work is probably going down, you grab all you can before the music stops. Right? Maximize now. Tomorrow, you might not have a job. These guys were making a killing, so if they could get away with a cool 50 to 200 million, why not get while the getting's good? It's not like they'd starve if they never worked again. Chances of a suit serving serious time in jail are slim to none.
Greenspan somehow glossed over this in his Randian haze. The guys doing wrong by their banks and their customers were doing what they were supposed to do as taught by this theology.
Also most companies have too much faith in using insurance to balance excess risk. They always forget the insurance company can fail. AIG.
Friends don't let friends read Ayn Rand.
....... when both friends are governmental mooching mystics who share the morality of death
an ignorant fascist speaks
END THE FED
My generation don't care whether your left or right. We just want the best people in the job.
looks like everything i was told in school is now wrong...
I'm having a hard time in understanding as to why he can't be held accountable and accused of at least something? Why is he able to roam free - necessarily speaking - after he corrupted the whole economy?
How right you are Thomas....how right you are!
Does anyone know where the full version of this can be found? Saw a clip of this on Frontline: The Warning doc, a little more here, but now I want to see the full thing.. any clue?
Alan Greenspan serves his masters at Wall Street... expect him to be loyal to them even if it means following them to Hell
Greenspan: Financial institutions knew more about borrower credit risk than regulators… [hence as Fed chair, Greenspan enabled institutions to lever up on huge credit risk for profits, leading to the worst credit crisis in US history since the Great Depression 👏🏽 👏🏽 ]
Fixed-rate 30 years means you will never own the house. Biggest lie in economic world.
he didnt understand the bankers knew the government had to and would bail them out lol. get your money out of banks
"...specifically banks and others...." lmao
Free trade and deregulated markets are different things
AKA The Sgt Schultz Defense.
"If the facts change I will change"
Has anyone asked him any follow ups since?
Even today these banksters regurgitate Milton Friedman.
Somehow no one ever asks, why were regulations put in place during the great depression by The New Dealers?
Maybe he didn't factor in their chances of gettin bailed out by the government. Maybe they knew how the gov would help out and it madem more reckless.
For the wisdom of the world will be foolishness before God.
As anyone in finance knows, this is correct. The number of rabid mutant tigers in the streets is irrelevant when identifying the threat posed by a kitten.
Don't be so quick to judge Alan soo harshly. He has a very depth knowledge of economics. When he says that corporations are best left to their self interests, his thoughts and reasons are much more complex than what he shares as he knows we won't listen and that the senators will cut him short. Most of what he said comes from the ideas of Adam Smith. Adam Smith too is misunderstood to be a nasty capitalist, but his works clearly show he believes in regulation and stable govt and people to even consider a stable economy, that is a given
Not knowing something isn't a good deal is precisely how most of retailers make money.
I doubt any retailers would tell customers what a benefit it is to purchase from them at a higher price.
Absolutely anybody who claims to be able to get something for nothing is wrong. The only free lunch in the universe is the universe itself. Everything else is a zero sum game. The three laws of thermodynamics apply to economics just as well as physics, chemistry and biology. In English, the three laws are as follows: 1) You can't get something for nothing. 2) You can only get less than you thought you could. 3) You can never get put of the game. The yuppie financial managers all know this. The economists all know this. The public at some level knows this but cannot seem to grasp it. The pubic respects the yuppie financial managers and economists due to their position, non-elected power, and perceived expertise in their field.
The yuppie financial managers took advantage of the public's and elected officials' naievetee. They created financial products and investment vehicles which purported to create something for nothing, which is again, impossible. The same class of dishonest financial and business leaders closed US factories and transferred them to China in order to spite US union labor, and lower the inflation rate. The arrogant yuppies found it offensive that they had to pay workers anything more than slave wages. The arrogant criminal yuppies engaged in corporate raiding in order to profit from the theft of corporate employee pension plans and the sale of the factories to China. The arrogant criminal yuppies bribed politicians to relax banking laws and eventually replaced the excellent Glass Stegal act and other excellent financial protections with the very corrupt, poorly conceived, and dishonest Graham Leech Blighly Act. Still more US factories were closed and shipped to China to enable bigger profits for greedy, dishonest yuppies at the expense of the American public. Banks began to offer impossible low interest loans with variable rates guaranteed to cause defaults when the interest rates jumped to market rates. The banks created an impossibly large housing bubble. When the bubble finally burst and all of the free lunch investments began to collapse, the arrogant criminal yuppies bribed and cajoled our government into bailing out their dishonesty. We the people were forced to subsidize the rich, who should be poor now because that is how capitalism is supposed to work. Capitalism is a two way street. You benefit when your company succeeds. You lose when your company fails. The state does not interfere. But that is not what happened. Business wanted and received de-regulation so that they could reap the benefits. But when de-regulation hurt the rich, they expected and received our money to make up for their loss. In addition, the rich yuppies were allowed to screw with our money even more. The arrogant criminal yuppies were allowed to keep their huge salaries and bonuses even while their companies were being baled out with our tax money. The arrogant yuppies were allowed to slap a private tax on our commodities, including fuel, food, metals, and more in order to subsidize their extravagant lifestyles. The private tax came in the form of four dollar a gallon gas and other artificially high prices on commodities due to speculative manipulation. This horrendous thievery was allowed due to fears of a complete financial market collapse and an ensuing depression. So, housing prices were kept artificially high, to enable the relentless takeover of housing by rich investors. Wages were lowered through elimination and offshoring of middle class jobs. All the while the rich kept getting richer, the poor kept getting poorer, and the middle class has become almost non existent compared to what it was only two decades ago.
While this was all going on, the yachts got bigger and bigger. From the end of WWII until the early 1980s, a yacht bigger than 80 feet was very rare. But the public had access to an endless variety of small pleasure boats in the 20 to 35 foot range, with sleeping accommodations. Civil aviation took off. We drove nice cars, usually two per household. We lived in large homes which we owned or had a mortgage on so we could own them eventually. We had a solid, prosperous middle class. Today, a large portion of "starter homes" are owned by institutional investors and rented out to lower middle class people who have no hope of ever owning a home because middle class jobs have all been outsourced. Forget civil aviation and family boats- that is a dream long gone. We struggle just to pay our rent on our apartment in someone else's starter home, while working two or more menial jobs. The products we buy are mostly foreign made garbage, much lower in quality than the consumer goods of the US made past. Those of us lucky enough to own a home are forced to rent part of it in order to be able to afford the horrendous property taxes levied by corrupt arrogant local politicians who consider themselves and other government workers rightfully immune to the destruction of our economy. We are forced to subsidize an army of illegal aliens who rape our system and destroy our economy. We are still being forced to subsidize a class of aristocrats who can now afford to purchase yachts by the hundreds in the over 100 foot class the way we used to purchase cars. The same holds true with all other luxury products. The rich criminal yuppie oligarchs have an ever larger assortment of luxury products which they purchase with our bailout money.
Now lets take a look at gun control. As the upper classes have taken from the rest of us, they have pushed for gun control for the rest of us. This is not a coincidence. The arrogant criminal yuppies know what an enraged American public will do to them when we figure out what they have done to us. Take a look at the pattern of gun control legislation. Is it any surprise that the states with the tightest gun control measures are the ones containing our major financial centers? Is it any surprise that gun control is being pushed by super wealthy financiers such as George Soros and ex NY mayor Bloomberg? Also, notice how the rich limousine liberals are first pushing for bans on so called assault rifles, which are used in less than one half of one percent of all gun crime. Also notice how many wealthy foreigners are pouring effort and money into treading on US second amendment rights. The same class of international bankers and financiers who tanked our economy is now scared and wants the US government to protect them from the people they victimized.
Now lets take a look at big data. Over the past two decades or so, ever more powerful computers, and the internet have made the acquisition, storage, analysis, retrieval, and distribution of information on a mass scale feasible. Politicians have been bribed and cajoled by the upper socioeconomic classes into allowing our most intimate personal financial, medical, family, and other information to be made available to virtually anyone who wants it. As a result, ID fraud has become a rampant problem. We are forced to subsidize an army of criminals, both foreign and domestic. Our very honor and integrity can be compromised even when we have done nothing wrong. The same entities which created this problem now offer ID fraud insurance so they can profit from the problem.
We the people must take back control of our economy, our personal information, or lives, and our society. We do not need the permission of any oligarchy to do this. The oligarchy needs our permission to dominate and control us. We the armed and strong people of the USA must take our country back from the self imposed oligarchy before it is too late.
1) We must ban the ownership of single family homes by anyone other than the occupants of the home.
2) We must go back to the sliding scale income tax of the past, with lower brackets around five to ten percent and upper brackets around seventy percent for multi million dollar a year incomes. At the same time, we must cut back or eliminate double taxation and eliminate the real property tax. Real property taxes are way too arbitrary and capricious and allow for far too much abuse by corrupt local government.
3) We must repeal the very corrupt Graham Leech Blighly Act and reinstate the excellent Glass Stegal Act with its related protections.
4) We must pass the equivalent of the European Union Safe Harbor Act and the Right to be Forgotten Act, in order to protect our privacy, our dignity, and to curtail ID fraud. We must severely limit or eliminate private acquisition and control of our personal information in order to limit or eliminate the power and abuses it gives to the oligarchy.
5) We must force the SCOTUS to overturn the horrible Kelo vs New London and Citizens United decisions. Kelo opened the door for egregious abuses of eminent domain seizure for transfer of private property from owners to greedy private developers. Citizens United allowed big corporate entities, including foreign ones, to influence our elections with huge soft money contributions to political campaigns.
6) We must take back control of our manufacturing from foreign entities and their US partners in banking and finance. We must force level playing fields for all of our domestic companies. We must give our business entities the same protection and competitive advantages which foreign entities enjoy, without hurting our workers wages. We must eliminate all foreign subsidized targeting and dumping in our markets.
7) We must protect all of our rights at all costs. First, we must protect our second amendment rights because this is the method of last resort to stop tyranny and to curtail abuse of power. Next, we must vigorously defend all of our other rights from abuses by both government and private entities.
We the people have a right and a duty to protect ourselves from egregious human rights abuses at the hands of the arrogant criminal yuppie financial oligarchy which has plundered us for far too long.
Americus Patrioticus well said
Sorry I was late to this party, but VERY well said sir.
'Derivatives markets are working well.'
Senator Bernie Sanders knew he was wrong and Greenspan gave him a smug answer and DID NOT LISTEN!
how did this guy escape from the looney ward?
Maybe I missed it, but what is the date of this testimony?
The house market crash
12-29-2022 I was here!
The doddering old Ayn Rand loving free market disciple is humiliated by his incompetence.
the humiliation is yours. free markets? HOW are their free markets with a bank that has a monopoly on monetary policy where said bank regulates the discount window and fed funds rate?
did you even THINK OF THAT or did you just simply spew your horseshit?
This all begs the question: why place this amount decision making within one individual/institution? And let's not forget, credit markets were liberalized but only after consumer credit culture changed from disciplined saving and calculated credit risk to extravagant credit purchases. Saving rate reduction was a direct result of increased taxes.
It wasn't just one there was, the Commodity Futures Trading Commission, and the Treasury among others.
It's ALL about interest-rates and only about interest-rates and interest-rates on interest-rates!! And it's about buying and selling book-money and paper-money in the stock-markets. 99,5% of all deals are about paper and book-money. 0,5% of the deals are about goods !!! HELLO IS ANYBODY HOME ??
1:41 i see ben bernanke way at the back LOL
this guy has gone from meistro to irrelevance.
Greenspan was out of touch. The guy probably has not try to buy a house for the past 20 years.
He's so right. We all have a view of the world based on our personal beliefs and experience. When that changes it can really shock the system. Also when interest rates change too fast ot really shocks the housing industry and affects prices based on monthly payment affordability. I think the fed ahould work to stabilize interest rates at a more constant level and stop with the up amd down shocks. Also the government shouldnt compete with private industry for capital by paying interest on the debt/bonds. That is useful in war to reduce demand in other areas of the economy in prep for change to war industry and transfer of jobs, but in times of peace the deficit should just be newly printed money(like quantitative easing but without paying interest on it to the fed who gives that money right back anyway. Silly circle!)
🤯 Hang on.. with zero per cent interest on debt, what incentive do buyers have to lend money to the government? Inflation-adjusted, the principal returned is guaranteed to be negative!
um the US tax payer "absorbed that risk" where is keyboard cat when you need him...
Friedman was in favor of abolishing the Federal Reserve System and replacing it with a mechanical system in nature that would keep the quantity of money going up at a steady rate, issued directly by the government and cutting back on fractional reserve banking powers for the banks.
POINT! Why'd this get marked as spam? Although, scamming the lenders via government force is really merely only an extension of the same scamming that the 'system' perpetrates - and then it blows-back on the people via foreclosures and the whole crisis. The root problem might still be the whole scamming-encouragement thing, though, and Ayn Rand isn't against that really, Game Theory isn't against that, to make the argument less personal and anti-Rand. Game Theory is only ONE option, though.
It's almost as if the past can predict the future.
Past performance is not a reliable indicator of future performance
@@Hazza4257 the past may not repeat, but it certainly rhymes
Simply Speaking ... NOBODY KNEW WHAT THEY WERE DOING !
Of course they knew; they just didn't care about the consequences as long as they were making money.
Uh....quite the opposite you fool. clearly you've NEVER worked in institutional finance
HE WAS WRONG! AND THAT WAS HE WAS QUESTIONED!...
Respect to the man. It takes great character for a man of such stature to admit that he was wrong.
Partially?!?! Partially????? Are you f***** serious?!?!?!?! The arrogance!!!! 🤬🤬🤬🤬
Pity that the corporate ambition sabotage to their own self interests didn't leave them responsible in despair or impacted negatively like it should have.
Smart in the end to not have had all their eggs in one basket.
So their mistake costs people they know everything.
But, not them. They feel like they watched a Lion stalk and kill an Impala. Perhaps some emotion. Now change the channel.
@RonanG And Ayn Rand was heavily influenced by Ludwig von Mises, something in common with Ron Paul.
@exenrontexas And many of the programs put in place to protect the people of America from such failures, such human suffering has been dismantled since Reagan which climaxed in the current economic failure. There have been numberous red flags along the way like when Reagan deregulated the S&L industry and it collapse. S&Ls aka thrifts performed a vital function of citizens savings being used for home construction. Reagan changed that and gave it to the banksters and derivitives.
Typical elegant rebuttal from Greenspan. Showing his street smarts. However, it angers me that these leaders can be slow to be alert to new problems, and even slower to come up with solutions and Change.
What happened was markets did not police themselves. So much for the Libertarians.
Theres no other ukrainian village to move on to after you squeeze the gentiles dry. When a critical mass of people get wise to the schtick, you'll see one of two things, free money (2002) or mushroom clouds (2022)
what does the mushroom cloud mean in 2022? Does this mean that once this whole global banking scam is discovered by the masses - that Israel will just nuke us all? I just learned they have incredible nuking power and some quotes about how they will take us all down with them if necessary...
I will bet he has not apologised to Brooksley Born.
He needs to appologise to Brooksley Born now!
Fully qualified in #MarketingScience, though.
Greed needs to be government regulated... however they can get that done, IT NEEDS to be done or this country is finished
Small criminals get caught and incarcerated for petty theft....big criminals however...
I would like to hear from him what does he thinks that we should do from now on, lets not jump to conclusions and kill him imminently, sometimes great falls must be succeed for a lesson to learn, that is were wisdom comes from, I would love to hear his new view point on how the world run
+RTWrename hed lie more
Friedman urged the Fed to adopt a constant growth rate for a monetary aggregate as
a faute de mieux policy that would reduce the volatility of money growth
Citation: Monetary Policy and the Legacy of Milton Friedman
he said in a manner that hid it best, that he fucked up largely
I think that we need to elect the president of the federal reserve.
BUTWHAT DIDYOU EXPECT FROM AN AYN RAND LIBERTARIAN ?
he alone destroyed America
Good god...the chairman of the fed and you don't get it?
earth**. goddamm it.
Doesn't add up, he believes in free markets, and yet he was head of the FED. He liked being an important, powerful player, rather than being a person of integrity and substance and doing the right thing. If he was really taking Atlas Shrugged to heart, perhaps he should have opted out of the corruption and went off-grid to John Galt's Gulch. Instead, he facilitated the corruption and the market manipulation and became a James Taggart, or rather just another looter. He did not practice what he preached.
Competition will drive price of goods to its cost. That's how capitalism works. All profit is due to either lack of competition, so one can "scam" its customers by offering price with highest profit.
People do buy "scam" all the time. Reseller routinely sell stuff at above market value to get most profit. In this case, reseller is scamming those who doesn't know the market value of a good.
Sellers refuse to disclose the cost of its goods is a way to scam customers.
Well, actually I do not believe that he was the prime culprit, but just being parts of stupidity and greed culture pf wallstreet
Blame it on the loan officers, that bank regulators cant regulate.
Bank "regulators" are nothing more than cronies and ex-employees of banks - as is the entire staff at the Federal Reserve.
Its all about crony capitalism and capital outta a printing press.
Nothing wrong with Ayn Rand....except the Invisible Hand in the face of individuals who know how to manipulate a square of the whole negates the rest of the fingers
This actually made me respect Greenspan more because I think he was very honest here.
@RonanG Exactly! That book was chockfull of strawmen, flawed arguments, and a totally black-and-white view of the world. It was exciting and well written, but totally rediculous. I lost all belief in Greenspan's intelligence after reading it.
because arrogant pseudo-humans like this (and there's more than one before you accuse me of simplistic generalising) are the ones who make the laws and on the rare occasion they can't find a loophole to sneak out of, can typically buy themselves out of trouble. POWER, it's about POWER vs. love. That simple; whether you choose to see it or not is up to you.
Exactly. I love trolling them by challenging them to admit it, though. They know I know but are so indoctrinated / scared to admit the truth, that it amuses me to fuck with them. I know, I know, I'm sad, it's my pathological aversion to lying and profiting from ignorance rather than education, that motivates me. Sue me, eh? :-p
Remarkable, this clown was guiding the largest economy in the world into disaster, and all the time he thought he was doing a really good job.
Whether or not Greenspan is greatly responsible I will not judge, but I will give credit to Waxman for asking questions that allowed Greenspan to answer honestly and modestly, versus the merciless punishment from Sanders.
greenspan is lying and covered. GOD DAMN WAKE UP
In 2005, one year before dying, Friedman said that US economy was doing great, deficits were not important, housing bubble was not that great, etc. I think you can find it in youtube. I prefer Mises, Rothbard and Hayek ;-)
doesnt understand lol??? 10 years later he explains the problems hahahha .
@uluuluululu Nice spelling job.
HNY
Bernie tried to warn him...
He needs to appologise to Brooksley Born now!
Paul nodalo - On that, I could not agree more!