WASHINGTON (Reuters) - Former Federal Reserve Chairman Alan Greenspan said on Tuesday the U.S. economic recovery was "extremely unbalanced," driven largely by high earners benefiting from recovering stock markets and large corporations.
Small businesses and the jobless are still suffering from the aftermath of a credit crunch that was "by far the greatest financial crisis, globally, ever" -- including the 1930s Great Depression, said Greenspan in an address to a Credit Union National Association conference.
"It's really an extraordinarily unbalanced system because we're dealing with small businesses who are doing badly, small banks in trouble, and of course there is an extraordinarily large proportion of the unemployed in this country who have been out of work for more than six months and many more than a year," said Greenspan, who headed the Fed from 1987 to 2006.
With both housing starts and auto sales "dead in the water," he said he thought it would be difficult to make the case that the economy is poised for a strong rebound.
A Report of the Committee on Environment and Natural Resources National Science and Technology Council May 2008
“that it is unequivocal that the average temperature of Earth’s surface has warmed recently and it is very likely (greater than 90% probability)2 that most of this global warming is due to increased concentrations of humangenerated greenhouse gases”
The banking system has still frozen out Main Street where the jobs come from. Bank reform should have been first. Did everyone see the stories about the role of Goldman in Greece's and the EU's problems? They made a ton of money off Greece and probably much more essentially shorting it since they knew their plans with derivatives they sold them would eventually sink them.
They have been making money shorting dollars and recycling declining offshore US dollars into harder assets, maybe in your back yard. Right now Goldman is stronger than anything financial around save the state owned Bank of China. Given all that why should they or their near-peers bother with ordinary commercial banking?
By the way, Greenspan turned out to be a genuine Ayn Rand-style Libertarian. He should not have been in a position of responsibility at all. Bush's Libertarian SEC, a contradiction in terms, was instrumental in our economic near-death experience in the fall of '08. Libertarianism needs to join Communism in the wastebasket of history. In their respective ways each is a bleeding disaster whenever it's tried.
"the jobless are still suffering from the aftermath of a credit crunch that was "by far the greatest financial crisis, globally, ever" -- "
how dare Obama not solve the greatest financial crisis ever in one year with the republicans fighting him every step of the way. So considering that this is the greatest financial crisis ever, its pretty impressive that UE has peaked after 3 years. UE increases for 5 years after every other financial crisis
" An examination of the aftermath of severe financial crises shows deep and lasting effects on asset prices, output and employment. Unemployment rises and housing price declines extend out for five and six years, respectively. On the encouraging side, output declines last only two years on average. Even recessions sparked by financial crises do eventually end, albeit almost invariably accompanied by massive increases in government debt. " http://www.economics.harvard.edu/faculty/rogoff/files/Aftermath.pdf