Alan Greenspan Warns Stocks Are "Without Doubt Extremely Overvalued"

Tyler Durden's picture

While America 'believes' it is highly productive, former Fed Chair Alan Greenspan instantly dispels that myth in another ominous appearance on CNBC this morning, "American productivity has gone nowhere in the last few years," and that is what is holding back wage growth. Furthermore, reiterating his concerns about the inverse relationship between surging entitlements and weak savings rates, Greenspan noted, "the annual rate of increase in entitlements of 9% per year...and the people that receive it believe they are getting their money back and have a right to it." There simply is no long-term investment as businesses favor short-term actions as the Maestro explains Fed QE lowering the real rate of interest "has been responsible for the rise in P/E multiples... and when rates normalize, that will reverse," adding that "we can't argue that we are extremely overvalued in the marketplace."


Greenspan explains... Productivity... Savings... Entitlements... Euro Failure... QE...Fed bubble-blowing... stock overvaluation and 1929 looms...

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Shocker's picture

Well there is no economy

Shocker's picture

Stocks can only go up for so long with this no growth economy

Layoff List:


Looney's picture

Will this Pterodactyl ever die and shut up? ;-)


BLOTTO's picture

Ironically, its this cunts bday today...

SoilMyselfRotten's picture

And someone just beat gold with an ugly stick

HelluvaEngineer's picture

I'm sick and tired of this old fuck going in front of the media and trying to get right with God before he croaks.  Oh, you've always been a student of Ayn Rand and loved gold?  Bullshit.

flacon's picture

"adding that "we can't argue that we are extremely overvalued in the marketplace.""

So what he's saying is that we AREN'T overvalued? Typical Greenspanish.  

Self-enslavement's picture

Lies, smoke and mirrors. That's how it's done. They want you to believe that money is created out of thin air. Do you believe that?

Printing new currency steals from existing currency by devaluation.

Hint: they tell lies.

kaiserhoff's picture

and who is most guilty of these crimes,


BuddyEffed's picture

The market is guaranteed to rally on these observations from Greenspan.  Not only do they create money out of thin air to dump into the market and stocks, they tweak the news feeds to get the gullible to short the market so that when the stocks pop on the new money, the short coverings also generate paper profits too.

Pinto Currency's picture



Greenspan, Rubin, Rothschilds are all starting to chirp - trying to help out.

Must be close.

Hyjinx's picture

Turn-of-phrase: "we can't argue (with the fact) that we are extremely overvalued in the marketplace."  He's pretty damn old so I'll give it a pass.

The Third Man's picture

Alan Greenspan...just another Robert McNamara.

Blano's picture

Yes, with the possible exception of a couple sectors of the stawk market.

NoDebt's picture

So the reason wages aren't rising is because productivity is flat, huh?  What about all those years when productivity was booming and wages were flat to declining?  Wages have been down 5-7% in real terms since 2008, but productivity took BIG leaps coming off the bottom of the "great recession".

What is the incentive to be more productive, exactly, when you don't get to share in it's benefits?  Fuck it.  I'm calling for a work stoppage.

BrosephStiglitz's picture

Real wages* have been in decline in the US since the 1970s, while productivity certainly has not declined, but yes, absolutely. Also, I have to say, while this fucker is screaming bloody murder about stock valuations, he is misdirecting away from the big warning which is sounding in the debt markets.

Misdirection.  I'm starting to think that Greenspan is the right hand that distracts people, while the left hand is in people's pockets.

*Of course this is an aggregated statistic, real wages have not declined for the top earners, just the unwashed masses. 

Self-enslavement's picture

Wages don't keep up with inflation because all of the newly created paper goes to the top. Everyone knows that. Why Zerohedge doesn't come right out and address that, your guess is as good as mine.

BrosephStiglitz's picture

Lots of reasons why real wages declined.  For a start the US (via corporate interests) effectively opened up the labor market to become global.  Your US citizen was competing against peasants in Cambodia, China, India, Indonesia, The Phillipines etc. who could produce for a fraction of the costs due to purchasing parity.

A lot of unions were broken up in the '80s.  Financial deregulation during Reagan/Thatcher, and Clinton (under this guy above who is still in the "fleece the morons for the powers that be" business).  Financial deregulation simply gives bankers, politicians etc. too much control of the monetary economy, and gives them a first mover advantage.  

Also, as you point out, inflation, which is again linked to the above.  Basically real income has increased for your upper economic strata, your asset ownership class.  For everyone else it has been stolen.

Funny thing.. I built an inflation simulator with an RNG for a game of Monopoly (because I am a geek like that.)  Me and 5 friends played the game.  The first game lasted ~30 rounds.  The second game lasted ~15.  In essence the inflation (which had an arithmetic mean of ~3.4%, not too far from the annual US inflation rate since the 1950s, around 3%) just sped up the process of people getting bankrupted and sped up the asset accumulation.

As an aside, I wanted to simulate a deflationary crash but.. the game ended before it could happen. 

Edit: Of course, in the real world you would have a 7th and an 8th player with controlling interests in the bank itself, profiting off of the increased money supply, but there you go. 

aardvarkk's picture

Wake up.  ZH has addressed that issue MANY times over the years.

Chump's picture

And as recently as one week ago.

Market participants want to hear that Americans continue to do poorly enough in the eyes of the Fed so that the Fed will continue to fund their wealth appreciation.  Period.   Welcome to modern day America.  The land of debt, income disparity and easy money to those who don’t need it.  The entire system is completely out of whack.  But markets can have a negative correlation to the economy so long as the Fed is willing to print and inject money.  This is dependent on the USD of course, but currently there are no concerns of USD weakness.

Being new to ZH is no excuse.  The search button does indeed search.

JRobby's picture

The time frame corresponds with governments growing larger and issuing more and more debt to support standards of living.

Colonel Walter E Kurtz's picture

No shit, No Debt.

Have been in commercial construction and from 2000-2008, I watched house prices going through the roof. Any loser became a home builder and was raking in the money, and I could not figure out what was going on. I assumed labor wages were rising  Every so often we would get asked by a home builder to price their work and I would eventually be told what the installation costs prices were, and they were lower than the prices in the early to mid 90's. I could not figure it out. Eventually loans and illegal labor has a way of messing up the natural supply and demand of the labor market. And when the housing market crashed, a lot of that labor came into the commercial market. The manufacturing off-shoring model has been imported to the construction labor market.

At least we still have bartending and waitstaff work to look forward too.

Forward comrades!    

Oh and by the way.... same crap going on now in the apartment building sector.


highly debtful's picture

NoDebt, you do realise sooner or later I have to tell your NSA about your comments here, don't you? But don't fret, I suggest you do the same and contact my "Veiligheid van de Staat" (our version of the NSA, but with a year budget of  probably no more than 10 millions euros). Maybe we'll meet up in Guantanamo. And guess what? I can imagine worse company in a prison cell than you. 

Bemused Observer's picture

How can wages rise because of productivity? Our whole system is geared to compensating labor by the hour. This is one of the reasons for the wage/productivity disconnect in the first place.

Technology allows one man to do the work of 10, but he still gets paid by the hour for one. Meanwhile, management pockets the wages and productivity of the other 9 who get pink slips...

How do you raise wages meaningfully under these conditions? When you try to do it through the minimum wage, you end up with 50 dollar an hour busboys.

clade7's picture

Somebody feed this old tortoise a head of lettuce so he has something to nibble on and shuts the hell up...

jcaz's picture

Yep-  the old fuck pulled the trigger on this mess,  refuses to take any responsibility for it.  History will show that Greenspan's vanity about being a "rock star" elevated the Fed Chairman gig from a $70K/yr token bureaucrat slot to fucking Himmler-esque power-

Stop showing up on TV to collect your $400 CNBC fees and fucking die already,  you toad......

Buckaroo Banzai's picture

I seem to remember that the last time Greenspan said stocks were overvalued, they proceeded to rise for four more years.

HelluvaEngineer's picture

Going on record - I think the party ends this fall.

Jstanley011's picture

The trouble is, when you are right about the end of the world, when it happens nobody cares.

sodbuster's picture

Looks like Greensperm was beaten with an ugly stick- repeatedly!!!

smlbizman's picture

people believe its theirs...cause that is the bullshit they were told when they were stuffing up ur ass...its not rape its love.....oh wait it was rape...

Crash N. Burn's picture

"Will this Pterodactyl ever die and shut up? ;-)"

Not just yet, the oligarchs need to have their whores warn the serfs about the crash they are about to cause. Falls under the CYA clause: Cover Your Ass - don't want to end up dancing from a lamppost.

Personally, I found it much more interesting when that old Rothschild whore let truth slip:

Allen Greenspan Admitting the FED is above the law congress and president


GetZeeGold's picture





Don't trust him.....he's a closet barbarian.....I know what he wrote in 66.

GetZeeGold's picture




Go around back.....I'll hook you up with transcript.

highly debtful's picture

Ironic, isn't it? He started his career with gold and at the end of his life cycle he's back at it, while inbetween... , well, we all know the story, don't we?

What I would like to know is how much physical the man's got stashed away? Betcha it won't be small potatoes. 

Hayabusa's picture

I just hate it when guys like Greenspan "come out" of the "closet" they've kept themselves in for decades

doing all kinds of BS that benefit the rich/powerful while concurrently screwing the 99%.  Alan, it's too

late to "come clean" now... the damage is done and you are one of the most responsible for the state

of affairs as they stand and will go down through the history books as a sell-out bankster lapdog.

dufferin's picture

it's all Fiction... Legal Fiction... Dead Legal Fiction... 

confederacy of the dunces's picture

Greenspan is simply a Gatekeeper. TPTB have him reading from their playbook. All in due time.

As jimmy Morrison said :The future is uncertain, and the end is always near..." -- Roadhouse Blues.

JRobby's picture

"Squawk Box" Now there is a highly rated show everyone should tune in to...........

Keep trotting out oligarchs who contributed to this disaster. Greenspan being one of the most visible. He should be ashamed to show his face.

BeaverCream's picture

Posted 20 mins ago?  You're right, WTF.

GetZeeGold's picture



Greenspan: Stocks not too hot, despite bubble talk


5 Mins Ago


See......this is why we have these team meetings.

Cthonic's picture
Greenspan: Stocks not too hot, despite bubble talk | 12 Mins Ago
HelluvaEngineer's picture

Telling everyone exactly what they want to hear. That's how these controllers work.

mrdenis's picture

Him speak with forked tongue ........

Raging Debate's picture

Headbanger - Good catch on that link. If Greenspan was starting to come clean this shows he changed his mind. Someone probably whispered in his ear.

I like to think no one is beyond redemption but obviously Greenspan isn't serious in watching today's interview.

As for CB language it can be translated once you understand it is based on socratic logic.