"Easy Al" Greenspan, who erased M3 from the official memory-banks, (hiding his Fed's enormous increases in the money supply) was the target of a speech by Paul Volcker in 2005.
Excerpts:
"Altogether, the circumstances seem as dangerous and intractable as I can remember."
"I come now to the heart of the problem, as a Nation we are consuming and investing, that is spending, about 6% more than we are producing. What holds it all together? - High consumption - high leverage - government deficits - What holds it all together is a really massive and growing flow of capital from abroad. A flow of capital that today runs to more than $2 Billion per day."
And zeroing in on the target:
"What I'm really talking about boils down to the oldest lesson of financial policy in Central Banking: A strong sense of monetary and fiscal discipline."
Greenspan liked his chairmanship a lot. So much so that he was willing to purchase Happiness for two+ Administrations.
Perhaps the public got screwed. Oh, well.
HT: Calculated Risk
Agree. This is a great post by CR. Fiscal discipline has been abandoned by government at every level. The coming hardship on the public is the combination of selfishness and the power of taking. The fix is in breaking the combination. “I want” is probably universal, so the fix is in limiting the power of taking.
ReplyDelete