Sober Predictions by Greenspan
This week the hot name in the news is Greenspan, as in Alan, the former chief of the Federal Reserve. His memoir has been published and he has been making headlines with a critique of the Bush administrations economic policies. Vice President Cheney answered back with a comment on the Op Ed page of The Wall Street Journal this morning.
Robert Samuelson has a good column that summarizes key points of the book and Greenspan's legacy a the Fed. Here is the last paragraph of the column.
As for Greenspan, his outlook is decidedly somber. Oil prices have already soared, reversing globalization's impact on inflation. He sees little relief. He thinks productivity growth will slow at best to 2 percent annually, down from about 3 percent from 1995-2005. He fears that inflation will gradually move to 4 percent to 5 percent and, in the process, raise interest rates and hurt stock prices. He worries that the nation hasn't faced the costs of an aging baby boom. If he is right, the age of tranquility may slowly become his age of turbulence
Be sure to read my article in this issue of WNP, "Are We Living in a '9/10' economy?"
