Alan Greenspan
Alan Greenspan
Alan Greenspanis an American economist who served as Chairman of the Federal Reserve of the United States from 1987 to 2006. He currently works as a private adviser and provides consulting for firms through his company, Greenspan Associates LLC. First appointed Federal Reserve chairman by President Ronald Reagan in August 1987, he was reappointed at successive four-year intervals until retiring on January 31, 2006, after the second-longest tenure in the position...
NationalityAmerican
ProfessionEconomist
Date of Birth6 March 1926
CityNew York City, NY
CountryUnited States of America
The United States is currently in its ninth year of economic expansion, an exemplary accomplishment by any standard. Growth of output has remained vigorous, unemployment is lower than it has been in nearly thirty years, and yet, despite the tautness in labor markets, there have been no obvious signs of emerging inflation pressures,
Fixed mortgage rates remain at historically low levels and thus should continue to fuel reasonably strong housing demand and, through equity extraction, to support consumer spending as well,
Protectionism in all its guises, both domestic and international, does not contribute to the welfare of American workers, ... At best, it is a short-term fix at a cost of lower standards of living for the nation as a whole.
Lowering the deficit further in the near term, however, will be difficult in light of the need to pay for post-hurricane reconstruction and relief,
Lower equity prices and higher financing costs should damp household and business spending, and greater uncertainty and risk aversion may also lead to more cautious spending behavior,
Lower budget deficits are the surest and most direct way to increase national saving. Higher national saving would help to lower real interest rates, spurring spending on capital goods so as to put cutting-edge technology in the hands of more American workers,
With price inflation already at a low level, substantial further disinflation would be an unwelcome development, especially to the extent it put pressure on profit margins and impeded the revival of business spending,
An increase in inflation doggedly forecast to follow the ever lower unemployment rate--now the lowest in three decades -- has not occurred,
Keeping out competitively priced goods would materially lower our standard of living.
History cautions that extended periods of low concern about credit risk have invariably been followed by reversal, with an attendant fall in the prices of risky assets.
Greenspan will note the economy's robust growth pace in a low inflation environment, ... the downside risks of the international weakness . . . most recently Brazil.
helped to lower risk premiums on debt and have contributed importantly to the favorable investment environment.
The current economic performance, with its combination of strong growth and low inflation, is as impressive as any I have witnessed in my near half-century of daily observation of the American economy,
The growing stability of the world economy over the past decade may have encouraged investors to accept increasingly lower levels of compensation for risk.