After the better part of two years of incorrect predictions and an autopsy of what lead to the current credit environment, and his flaccid defense of his termAlan Greenspan’s statements no longer effect markets……thank god.
In a NY speach Greenspan said that the worst of the credit crunch was over. Now, this simply follows statements from Merrill Lynch’s (MER) John Thain, JP Morgan’s (JPM) Jamie Dimon, Berkshire’s (BRK.A) Warren Buffett and Treasury Secretary Hank Paulson saying the exact same thing.
The difference this time is that back in early 2007 when Greenspan was predicting a recession that has not developed, his words moved the market. Anything at the time out of the former Fed Head’s mouth was run on CNBC and front page news in the papers.
Now thankfully it merits little more than a 200 word article on the web.
It is funny how history judges us based on the results of our actions. Greenspan’s legacy was tarnished when years of virtually free money finally caught up to homeowners and his actions and statements since leaving the Fed have only hurt it more.
Has he just kept quiet after leaving, the current situation would have dissipated and his legacy may have remained in tact. But, by involving himself in it now and in effect hindering the efforts of his successor, Greenspan just may have permanently harm it….
