Tuesday, September 16, 2008

Dean Baker On NYT on Greenspan::

The NYT Turns to the Arsonist to Analyze the Fire: Greenspan on Bank Bailouts

Alan Greenspan is certainly in a position to know about the problems the financial system is facing. After all, there is no one who bears greater responsibility for today's events.

But, it would be appropriate to remind readers that Greenspan was the arsonist here. He was the one who choose to ignore the abusive lending practices in the mortgage industry that became widespread under his tenure. He was the one who chose to ignore the growth of an $8 trillion housing bubble.

When he said that, "This is a once-in-a-half-century, probably once-in-a-century type of event," it might have been worth pointing out that he was the arsonist who created the conditions for the extraordinary set of events hitting Wall Street.

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