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Greenspan: Worst Financial Crisis EVER, INCLUDING the Great Depression
Greenspan just said that the current credit crunch is "by far the greatest financial crisis, globally, ever" -- including the 1930s Great Depression.
Bloomberg notes:
Greenspan
said that while the economy was in worse shape in the Great Depression,
the recent financial crisis was potentially more harmful than that in
the 1930s because “never had short-term credit literally withdrawn.”
Greenspan also said “fiscal affairs are threatening this outlook” for recovery.
As I pointed out last May:
The following experts have said that the economic crisis could be worse than the Great Depression:
- Fed Chairman Ben Bernanke
- Economics professors Barry Eichengreen and and Kevin H. O'Rourke (updated here)
- Investment advisor, risk expert and "Black Swan" author Nassim Nicholas Taleb
- Former Fed Chairman Paul Volcker
- Nobel prize winning economist Joseph Stiglitz
- Economics scholar and former Federal Reserve Governor Frederic Mishkin
- Well-known PhD economist Marc Faber
- Former Goldman Sachs chairman John Whitehead
- Morgan Stanley’s UK equity strategist Graham Secker
- Former chief credit officer at Fannie Mae Edward J. Pinto
- Billionaire investor George Sorors
- Senior British minister Ed Balls
Unfortunately, virtually everything the American government has done since the crisis started has been counterproductive. See this, this, this, this, this, this, this, this, this, this and this.
The same is true of most other governments.
In
the understatement of the day, Greenspan also called the recovery
"extremely unbalanced," driven largely by high earners benefiting from
recovering stock markets and large corporations.
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Beneficiaries of QE, that's all. Everyone in Silicon Valley is plugged into the benefits of the stimulus through the wired out stock market. When stock markets render all the stock options and other incentive based compensation, it'll all come down.
they can put their Cisco stock options as downpayment
Because thx to the idiots at the FHA, you can get a loan with 3% down in California - I assume u mean San Jose, Ca. Govt is trying like hell to keep home prices up and that hurts renters and would be first time homebuyers. They are all idiots.
They are succeeding at keeping home prices up.
not for long
Exactly. And one of the main reasons is because most of the sheeple think we are recovering. The price is what a buyer is willing to pay. When the zombies can't afford basic necessities such as Playstations and $175, shredded jeans, the bid for that house will disappear. Git you some PopSecret and enjoy the show!
I know a couple that married in early 09', and HAD to buy a house, just HAD to. Because that's the blueprint. That's the expectation. Get married and buy a house. Couldn't rent...nooooo. HAD to buy a house. They reasoned that the 8K in handout, plus being barraged with "the market has bottomed", made it a perfect opportunity. Plus the "experts" had things under control and there was no way that things were going to get worse.
The result? The wife lost her job, the home is about 12% underwater, and they're shitting themselves. The sick part is that they still think that they made the right decision. Their rationale is "what are the odds she'd lose her job and housing would continue to fall? It's not like we were financially reckless".
Not reckless. Clueless.
all the words that end with "less" will apply
playstations, shredded jeans and popsecret!! party at anon!
not for long. THe consumer confidence report "plan to buy home" still very low at 2.7%. Point is if u take all the risk out of buying a house thru 97 ltv lending, give a tax break to first time homebuyers and the best you can do is pull enough demand forward to stabilize prices for a few months we have a problem.
another thing might be real estate prices are notoriously slow to adjust, as compared to say traded stock and bond prices. in the last iteration stock prices bottomed in 1932 but many measures of real estate prices didn't bottom (at 85% to 95% down from the '29 top, earlier if you were in florida) until 1942.
Me neither! Why the fuck is a nice 2-br condo in Seattle still over 600 k?
Is it because Seattle residents are all "rich" and flush with cash from the stock market?
What a joke.
why bother to sell cheap?? hell RAISE the price and stop making payments --- then you can do a short sale that is over what you paid
or just write it up like that and the lackeys doing the paper pushing wont bother and file accordingly
drag your self out of the down town area,,
2 bedroom condos can be had for anywhere from 250,000 ton300,000,, in good parts of seattle
I think you should pay less attention to the "asking price", and find out exactly what they are ACTUALLY selling for.
I wish someone could tell him it's all his fcking fault
And what he did not say was what we face: ultimately (and painfully I might add), America did recover from that debt deflation episode. But there is no evidence that we will recover this time; that we'll go on to build more strip malls, eat more fast food, consume more oil for recreation, own 7,500 sq. ft. single family homes. That is not the future we've created for ourselves. No amount of financial innovation will secure that "entitlement."
Extend and pretend; extension and pretension -- all unrepeatable, short-term strategies to buy just a little more time.
The options for our future were already consumed. It's time to reset expectations, and hope the kids of this country don't seek revenge on their parents and grandparents.
"It's time to reset expectations, and hope the kids of this country don't seek revenge on their parents and grandparents."
Any wonder why Ron Paul is gaining traction w/ 20-somethings. This story is far from over. And when they find out that the Congress wants their parents to roll the nest egg into an annuity which will screw any chance they have of financial freedom in the future...
Revenge may be a nice way of saying "La Guillotine shall claim her bloody prize."
Time to Buy Farmland and Gold, Advises Dr. Doom (Marc Faber):
http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article7035913.ece
Power isn't all that money buys!
Greenspan is short the market. LOL
What a shelm.
and by shelm you mean a guy so hot he's out of your league but you still want him so bad it hurts?
Yes he very well might be short. After all he has buddies in "high" places playing the high stakes game
absolutely the first thing that I thought when I read the article on b'berg.
in the article, g'span also expresses his desire that the subprime market comes back sans securitization.
alan....subprime by its definition means that you are going outside historical underwriting standards that have existed and worked for decades. what a phucking putz g'span is.
So do we still call it the "Great Recession" ?
The Greater Depression works for now.
Yes... but it's starting to head into "Not-So-Great Depression" territory.
Expect a naming rights sponsorship war to break out between the makers of Prozac, Zoloft, and Paxil.
I vote for the Great Disintegration. I even registered the domain... in case anyone wants to start a new website.
cheers
Putz
Greenspan serves for almost 2 decades as head of the FED and then admits in front of a senate hearing that the principles and ideas he had about how the market worked were wrong. He deserves no voice in financial affairs. Wizard, market genius, yeah right. Read his history it will be very enlightning.
General Wastemoreland and Robert Strange McNamara are two other brilliant icons of our recent Development of Western Civilization that come to mind.
is that like a surfer not knowing the tide goes in and out? lol
Even better than that Rick: as you've said, he has ADMITTED that he had a "flaw" in his "theory" or "model". The best part is, his fucking PROTEGE who has the SAME ideology he had, the "flawed" ideology, is RUNNING THE ASYLUM NOW!!
Get a load of that, the "Bernanksker" is Greenspan X10!! He is going to wreck this thing well and truly, Alan's efforts will seem amateurish.
Yea I know, its ridiculous the connections between all of them.
No, it is not rediculous. It is the ZOG. As in Zionist Occupation Government. Last century, they attempted to universalize humankind through bloody communist revolution. They failed. This century, they are attempting to do it through globalist hypercapitalism. They will fail again, and at even more fearful cost. For them, and for us.
if they want to universalize (what does that mean?) humankind why be so "clannish" what with the don't marry the goys, build the big wall in palestine, for that matter have israel at all since it is such a sharp stick in the eye to a billion muslims and an increasing number of the rest of the world? first they're communists, then they're capitalists. seems like some jews have been capitalists all along and still are and some have been communists/socialists all along and still are. like some of the most effective anti-zionists are jews (glenn greenwald).
they cant blend in amongst all the eastern cultures.. so they will prevail and take the torch for the next 100 years or so
what does this mean? because the zionist jews can't blend in amongst all the eastern cultures (and why not: change their haircut, learn yet another language, wear a different hat. they are after all semites) they will "prevail"? why? and at what? and why for a century? just asking.
Even better than that SteveNYC: he knew it the whole time. he knew that whenever they withdrew the credit it was going down - which was why he was always quick to pump more liquidity in whenever there was a hiccup. Now that he is no longer there notice hes going back to more of his pre Fed days when he advocated gold ownership and the ills of credit expansion? However, the issue is that it was under his stewardship that the credit bubble was pumped up to the point that it couldnt continue - and now he talks about how bad it is...
Even better than that Gold...Bitches: is silver.
silver 1oz will be the new dollar - sound money
I'm sorry, thats a good list but since Ed Balls says whatever Gordon Brown wrote out for him over breakfast that morning, he shouldn't be on it.
At least Balls has balls!
Anyone who thinks we are going to walk away from this pending trainwreck unscathed is delusional. Just do the math...GDP has been consistently overstated during the past ten years by 'rigging' the inflation indexes... MEW's provided another $200B (+1%) of GDP while unsustainable budgetary and trade deficits annually kicked in another trillion (7%) or so. Let's not even talk about the balance sheets...
The 'Consumer' based economy... a children's myth soon to be relegated to the history books... is in intensive care on a QE drip and the prognosis is grim.
Anyone got a "Green Shoots" story that doesn't involve "magical beanstalks?"