Alan Greenspan testified today about his tenure over the Federal Reserve and how some in Congress are suffering from ‘amnesia.’ Most economist agree that the subprime loan scam was one of the main reasons for the economic collapse while Democrats seek more ‘financial reform.’ It’s always great to have the ones who supported subprime loans now wanting to regulate the industry.
The New York Times reports:
The committee examining the causes of the financial crisis heard a strong defense of the Federal Reserve from its former chairman on Wednesday as the panel began three days of hearings 0n the failure to rein in Citigroup, Fannie Mae and the subprime mortgage market.
In his testimony, an unflinching Alan Greenspan fended off a barrage of questions about the Fed’s failure to crack down on subprime mortgages and other abusive lending practices during his lengthy tenure.
He pointed out that the Fed had warned about subprime lending and low-down-payment mortgages in 1999, and again in 2001. And he argued that if the Fed had tried to slow the housing market amid a “fairly broad consensus” about encouraging homeownership, “the Congress would have clamped down on us.”
He added: “There is a lot of amnesia that’s emerging, apparently.”
Yes, the Democrats do have a lot of amnesia. I recall a group of Democrats, lead by Barney Frank proclaim there was no problems at Fannie and Freddie.
Of course, Frank was having a gay-love affair with Fannie CEO Franklin Raines while books were cooked. Also, Rahm Emanuel, Obama’s current Chief of Staff, was on the board of directors for Freddie Mac and made millions during this subprime scheme. The Obama White House is blocking appointing an Inspector General to investigate Freddie. The scandal continues.
