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
Without the needed restrictions on the size of the GSE balance sheets, we put at risk our ability to preserve safe and sound financial markets in the United States, a key ingredient of support for housing,
With regard to margin requirements, studies suggest that changes in such requirements have no appreciable and predictable effect on stock prices, ... Nonetheless, the Federal Reserve recognizes that considerable risks can be involved in the purchase of equity on margin, especially in volatile markets, and believes lenders and borrowers need to assess carefully the risks they are assuming through the use of margin.
Because it is a highly leveraged operation and one which requires very sophisticated hedging of interest rate risk, it's imparting a significant potential systemic risk to the American financial system,
Policymakers will need to be on the alert for oil-driven, indeed energy-driven, risks to our expansion, ... firm.
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,
fully appreciate the risk that some households may have trouble meeting monthly payments as interest rates and the macroeconomic climate change.
helped to lower risk premiums on debt and have contributed importantly to the favorable investment environment.
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.
There are sound reasons for concluding that the long-run picture remains bright ... but I would emphasize that we continue to face significant risks in the near term,
Until market forces, assisted by a vigilant Federal Reserve, affect the necessary alignment of aggregate demand with the growth of potential aggregate supply, the full benefits of innovative productivity acceleration are at risk of being undermined by financial and economic instability,
I believe that the general growth in large [financial] institutions have occurred in the context of an underlying structure of markets in which many of the larger risks are dramatically -- I should say, fully -- hedged.
Indeed, better risk management may be the only truly necessary element of success in banking.
At the risk of some oversimplification, if the skill composition of our work force meshed fully with the needs of our increasingly complex capital-stock, wage-skill differentials would be stable, and the percentage changes in wage rates would be the same for all job grades.