Homicidal Maniac Alan Greenspan: It Was All the Fed's Fault
It's entertaining to me that homicidal maniac Alan Greenspan feels compelled to express an opinion on the Fed's failings when it failed most spectacularly in its alleged duties when he was at its helm.
Former Federal Reserve Chairman Alan Greenspan said the central bank failed to foresee the magnitude of the financial crisis and that regulators must force banks to raise capital levels to guard against another one.
“The most pressing reform that needs fixing in the aftermath of the crisis, in my judgment, is the level of regulatory risk-adjusted capital,” Greenspan said in a paper prepared for a Brookings Institution conference in Washington today. “Adequate capital eliminates the need for an unachievable specificity in regulatory fine-tuning.”
Banks may need to hold capital equal to 14 percent of their assets, compared with about 10 percent in mid-2007 before the financial crisis, said Greenspan, 84, who ran the central bank from 1987 to 2006.
The Federal Reserve “for years” has been concerned over the growth of “megabanks,” which operate with no economies of scale that justify their size, Greenspan wrote in his paper titled “The Crisis.” “ Regrettably, we did little to address the problem,” he wrote.
The former central bank chief said he and others at the Fed didn’t fully understand the extent of the housing bubble and its ramifications for the economy. His comments echoed his October 2008 testimony before Congress, when he said free-market ideology may be flawed in the wake of a “once-in-a-century credit tsunami.”
STFU you old filthy bastard.