Greenspan Shocks the World

[n_huffhines]

Greenspan was a proponent of a gold standard, or a fixed money supply...that is until his career got in the way. Now that he is no longer Fed chair, he is speaking his mind again.

“The major thrust in the demand for gold is not for jewelry,” Greenspan explained. “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.”

While it is well known that the fiat U.S. dollar is under increasing pressure following years of extreme “quantitative easing,” the former central banker said the European single currency was also in big trouble. And the effects will be felt far beyond Europe.

“The euro is breaking down and the process of its breaking down is creating very considerable difficulties in the European banking system,” said Greenspan

Too bad Droski hasn't been around much lately.

Greenspan: Gold is a Currency, Euro ?Breaking Down?

 

[golfballs]

greenspan is one of the reasons we're in the mess we are.

 

[lawgator1]

Gold has value only because financiers and those cashing in huge on it have convinced everyone that it has some sort of intrinsic value. Its commercial value is actually tiny relative to its price.

Its a giant scam, at this point.

 

[n_huffhines]

greenspan is one of the reasons we're in the mess we are.

Because he was the chairman of a very flawed system?

 

[n_huffhines]

Gold has value only because financiers and those cashing in huge on it have convinced everyone that it has some sort of intrinsic value. Its commercial value is actually tiny relative to its price.

Its a giant scam, at this point.

Fiat money is the scam. It doesn't matter if there is intrinsic value, or not. The fact that you can't create it of thin air is the real value.

 

[Rasputin_Vol]

greenspan is one of the reasons we're in the mess we are.

Explain.

 

[Rasputin_Vol]

Too bad Droski hasn't been around much lately.

I think I may have run him off... :unsure:

 

[golfballs]

he kept rates ridiculously low for too long

 

[golfballs]

created the bubble

 

[Rasputin_Vol]

created the bubble

What bubble are you referring to?

 

[Velo Vol]

What bubble are you referring to?

Houses that once sold for $400,000 now selling for $250,000

 

[n_huffhines]

he kept rates ridiculously low for too long

I agree, but that's what Fed chairmen do. That's the system we apparently accept. We've got people saying 0% is too high. No reason to single out Greenspan unless you oppose the entire system.

 

[Rasputin_Vol]

Houses that once sold for $400,000 now selling for $250,000

Barney Frank and Fannie Mae/Mac were the ones responsible for allowing people that didn't need to be buying homes get financed... not Greenspan.

 

[Rasputin_Vol]

[youtube]http://www.youtube.com/watch?v=2UZ9l_AxKjA&feature=related[/youtube]

 

[n_huffhines]

Barney Frank and Fannie Mae/Mac were the ones responsible for allowing people that didn't need to be buying homes get financed... not Greenspan.

The housing bubble was decades in the making. Greenspan and Volker both kept interest rates low, thus driving up home prices.

 

[Velo Vol]

Barney Frank and Fannie Mae/Mac were the ones responsible for allowing people that didn't need to be buying homes get financed

It sounds as if you have been "learning" about the economy from talk radio.

Now some of your other questions are starting to make sense.

 

[Rasputin_Vol]

It sounds as if you have been "learning" about the economy from talk radio.

Now some of your other questions are starting to make sense.

I've read this twice already, but couldn't find where you posted the explanation for Greenspan causing the housing bubble.

 

[golfballs]

I agree, but that's what Fed chairmen do. That's the system we apparently accept. We've got people saying 0% is too high. No reason to single out Greenspan unless you oppose the entire system.

It's the chairman of the Feds job to keep rates low? Sure as hell shouldn't be. Now is one thing, but at the time it was uncalled for and we can see it's disastrous consequences. If I am to point my finger at one person responsible for this whole mess, it's alan greenspan
Posted via VolNation Mobile

 

[golfballs]

Barney Frank and Fannie Mae/Mac were the ones responsible for allowing people that didn't need to be buying homes get financed... not Greenspan.

They are a component to the problem, but not the source
Posted via VolNation Mobile

 

[Velo Vol]

I've read this twice already, but couldn't find where you posted the explanation for Greenspan causing the housing bubble.

As is typically the case for any complex event, there are a number of contributing factors and multiple people involved. But the housing bubble could not have formed without low-interest credit being available for several years. And that's the part that Greenspan made possible.

 

[n_huffhines]

It's the chairman of the Feds job to keep rates low? Sure as hell shouldn't be. Now is one thing, but at the time it was uncalled for and we can see it's disastrous consequences. If I am to point my finger at one person responsible for this whole mess, it's alan greenspan
Posted via VolNation Mobile

They manipulate the money supply and interest rates. When you f with the free market, invariably you are going to shoot yourself in the foot.

 

[Rasputin_Vol]

It's the chairman of the Feds job to keep rates low? Sure as hell shouldn't be. Now is one thing, but at the time it was uncalled for and we can see it's disastrous consequences. If I am to point my finger at one person responsible for this whole mess, it's alan greenspan
Posted via VolNation Mobile

What is the FED chairman's job?

 

[Velo Vol]

How does the free market set the money supply?

 

[Rasputin_Vol]

How does the free market set the money supply?

It doesn't right now. That is the problem.

I take that back, there is one market force right now that appers to be driving the money supply. That would be investors' willingness and demand for buying bonds/T-Bills.

 

[Velo Vol]

Someone has to set reserve requirements.