ya…his name is Ron Paul and everyone thought him a farse..

If you really want to know who predicted this, try the Ludvig Von Mises Institute.

Mises.org

Great point, Bing! I’ve been hearing a lot of talk about this being a “crisis of confidence”, but really, it seems to me that this is a “crisis of credibility”.

Too many leaders, in business and in politics (and on both the left and right) have lost credibility, because they failed to see what was coming – EVEN THOUGH quite a few people told them about it.

That includes at least one former Fed official (the late Ned Gramlich), several economists (including Hyman Minsky, Paul Krugman, and especially Nouriel Roubini).

The fact is that these shocked leaders simply didn’t want to hear the truth.

Were they all off playing Executricks?

Maybe we’ll find out when the prosecutions begin.

Maybe China actually had the right idea when they executed the high-level political guy who failed to enforce their rules on product safety – might get some attention in the executive suites…

idiot

Bing is right on!

I couldn’t agree more. I bet Greenspan is a Republican.

What’s amazing to me is that mortgage professionals in the field the last 3 or 4 years could see this coming from a mile away!!!I am an EX subprime sales rep who used to work for Chase. I loved my job and made a good living, HOWEVER, some of my friends that worked for New Century or Countrywide were making DOUBLE what I made and let me know it. Chase never did anything stupid and I thought that would keep me in business. What I never saw coming was he MAGNITUDE of the numbers these two companies were lending at. Do you how many UNQUALIFIED borrowers moved into their “new” homes with nothing coming out of their pockets? It’s no shock that someone who could not pay a utility company $100.00 would default on their loan once they started to see a decline in income or their home value. I am a 20 year mortgage professional and will survive this, but there are some great, hard working people BEHIND THE SCENES that are really the ones that are suffering and that , to me, is unforgivible. I truly believe that the management of these big investment banks buying this crap paper should be held accountable and either be fined or imprisoned, because that is what they did to us! Good day.

Yes I can understand Mr. Greenspan’s shock at creditlenders who loaned money to non credit worthy people. This is what he means by “protecting their interests” Seems like saying you have to eat something or you will starve to death. Wall street and mortgage companyies chose to starve. However, in 2003 the auditors found Fannie and Freddie to be “bankrupt” and House and Senate Republicans offered up legislation to reign them in and the Democrats failed to sign on…Prepared legislation in the Senate never made it to the floor Two or three other professionals also warned about the problems with Credit in the CAR INDUSTRY in 2005-2006 again everyone in Congress was asleep or mired in partisanship. As long as elected officials keep putting party over qualifications we will continue to have these problems. We have to get back to a least some level of personal integrity. This will be seen on November 20 when congress holds hearings. We are all to blame Please admit it.

I’ve always been impressed by Dean Baker’s comments that the media should stop interviewing the economists who were shocked by the recent events and start interviewing the ones who weren’t…

See http://www.prospect.org/csnc/blogs/beat_the_press

Sure, blame Greenspan, this is all his fault! After all, he can predict the future, nah, can control the future.

Greenspan is a genius and smarter than half of congress combined, don’t blame him. The collective geniuses on the planet could not have predicted or controlled this outcome. Give it a rest with the blame game.

Why Be shocked.. A trend Started, and no one saw it???

I can think of one guy that’s not shocked: Peter Schiff. He called this whole thing years ago.

Oh and Greenspan is dead wrong yet again. This has nothing to do with regulation, it has to do with him. He’s the one who kept interest rates too low and printed too much money. It’s the government intervention (Federal Reserve, Fannie & Freddie, CRA, HUD, etc) that caused this problem, not lack of regulation.

I think the fact that many people erroneously look at companies as a single entity looking out for the interests of shareholders and trying to do what is best for the company. People are taught this in business school as a general rule. This many times this has been proven to be untrue, especially in light of events that have happened withing the last 15 years. You have the big accounting firms being reduced to four, Enron, Worldcom… most of which took place because of the interests of few hurting the many.

Plenty of people who aren’t shocked, Bill Bonner, Nouriel Roubini, Karl Denninger, Ron Paul. It’s high time for a change of the guard and let those who squandered their responsibilities hang.

Ron Paul does not seem surprised. Neither are the folks at http://www.mises.org.

Yeah, we should have been listening to presidential candidate, Ralph Nader.

Jeez I thought Alan was pretty sheepish. He did not promulgate the hiigh risk, sub primate loans did he?

I am not shocked and I am not even a finance person. I’ve been asking for 5 five years how all these people could afford $400,000 – $500,000 homes. Well we found out how…it was all a grand illusion (some Styx there). As far as Greenspan being shocked, I’m not too surprised there. People in Government and at Universities are not the same as the people actually performing the jobs. They tend to be more idealistic and think more of people than they should. Whats shocking to me is the the Secretary of the Treasury was on television in March saying the banks are fine. I’m a Psychology major and I knew that was BS. The biggest thing I want to know now is when this deregulation occurred who sponsored the bill in congress and how much did lobbyist spend to get the bill written? My guess is some people in congress made out pretty well with this bill and I’m sure its buried and will never be dug up.

Well said. Unfortunately, Greenspan didn’t even take the every popular – and hollow – route of “taking responsibility”. This comes down to accountability. As a country we have to DEMAND more accountability for those in positions of leadership

They are still clueless. Honest home prices are driven by the owner’s ability to pay the mortgage. If salaries do not go up and property taxes keep going up and interest rates move higher the amount of home a person can buy goes down. You want to stabilize home prices and have them inch upward figure out what you will change – increase salaries, lower property taxes or lower interest. Mr Greenspan should say I was incompetent not shocked. He could easily have seen it was not adding up. People had no savings (for down payments), average salaries were flat for years, taxes at all levels were going up. So why were home prices going through the roof. You don’t need to be a Nobel economist to know that, just a high school home economics teacher, or a small time banker who made sure that they did not violate the 28/36 payment/gross salary ratio. How they will value these toxic mortgages is still Alice in Wonderland.

Shocked, I don’t think so. Anyone worth their weight in dust could see this one coming. Liar (no doc) loans and leverage rates approaching 50:1 were a quite clear sign. And it all started with the politicians and appointees … try looking at the ones doing all the finger pointing for a starting place.

This is not a failure of capitalism, it a failure of political policy pure and simple.

I’m not shocked. But I don’t have a degree in economics.

Maybe that’s a good thing.

I’m not shocked. And yes, there is a lot of people who aren’t. But these are the radicals, pessimists, anti-America… they don’t wear suits or drive fancy cars to impress you and convince you of buying their garbage.

They don’t tell you how beautiful and smart you are, how nice you hair looks like when they hate it, or most likely don’t care. And they say things will go wrong if you make poor decisions, like buying a car on credit.

Who would listen to these guys, when there are others, more palatable, available?

Ron Paul is not shocked. Am I right? Am I right?

Considering Mr. Greenspan’s lofty incomprehensible statements of yore, he has suddenly become not only understandable but contrite as well. Does this mean he now understands what he used to say?

I’m moved and astonished that virtually every single Ron Paul voter has turned up to comment on this posting.

I am Not shocked….He is shocked to cover up his screwups. How insane he was to drop interest in 911 panic and raise interest rate with inflation fear!!! Raising interest rate from 1% TO 5.25% IN SHORT TIME WAS A BIG MISTAKE. There was no regulation for “interest only loan” to fuel the downturn.

This story was about as helpful as Oscar Rogers solution to the economic crisis

http://www.nbc.com/Saturday_Night_Live/video/clips/update-thursday-part-2/742141/

Several years ago, I audited sales for a financial services company. The company did not want to hurt morale or sales so we had a monthly limit on the number of violations that we could report. I could hit my monthly limit in the first 2 – 3 days of each month. Then I spent the rest of the month working odd projects & goofing off. After 6 months, I was allowed to transfer to different department.

Management would further limit this audit team by transferring 50% of its staff to other areas. Then they started assigning non-audit duties to the remaining auditors. These duties required 75%+ of their time. Then the managment of the team was only given to former sales employees. This situation was not unique.

My point: Sr. leadership within Government, Politics & Corporate did not want to mess with the gravy train. So they blinded, muzzled & chained up the watchdogs.

Greenspan did this more than once to other government agencies. I do not know why he is surprised by the results.

Mr. Greenspan overlooked a critical fact. The firms were managed by caretaker managers who had little if any ownership in the organizations they managed. Yet they paid themselves as if they were entrepreneur/owners. If you hire mercenaries, you should not be surprised when you get mercenary results.

Arguably the biggest flaw in Greenspan’s thinking is right there quoted in your first paragraph: “…the self-interests of organizations …” There’s no such thing as the self-interest of an organization, because an organization does not have a self. An organization has a whole bunch of selves, each of which has its own self-interest, many of which may not identify with the interest of the organization any further than the next quarter’s huge bonus, the next excessive retirement package, the next ridiculously golden parachute. It’s this total divorcement of management and ownership — facilitated by a lack of meaningful oversight by captive boards of directors — that is the downfall of stock market-based capitalism.

Doesn’t Greenspan realize that saying he is shocked by this situation makes him look like an idiot?? Not one intelligent person is shocked by what has happened.

Gosh, We were stupid and you knew we were stuoid and you didn’t try hard enough to stop us from being stupid, So it’s all your fault.
Isn’t that right Mr greenspan.

ANS: Well not exactly, I knew the chickens would come home to roost but I didn’t think it would be in my life time.

Gee whizzie! An apology? Good thing he’s filthy rich enough to ride out the mess he’s helped to create. I mean…three years ago, I said to my husband…”How can banks be giving out loans with the proviso that only the interest be paid per month?” This does not bode well. I was dumb enough to think that our high-paid financial wizards knew what they were doing…not! And again, who pays for this? Me…sigh…

How ironic…. the “brilliant” Mr Greenspan is shocked??? As a former escrow officer for 20 years, little peon me could have told you this was coming… crap loans, negative ams, interest only… and then some other greedy idiot decides to “securitize” them and sell them to everyone greedy enough to buy them…. I think Mr Greenspan should be shocked… about 20,000 volts ought to do it!

Scientists are saying the greenhouse effects are threatening the planet. We are headed for scarce food production causing hunger and deaths. Water levels will go up with melting ice, destroying millions of homes. Hurricanes will be more frequent and more violent destroying number of cities in the world. Is anyone taking them seriously?

Economists all over the world talked about the credit crisis long before it started. Did anyone take them seriously?

We’re only human.

Bing I know you know a thing or two about economics. I would ask you to look at a dow chart from 1995 to present. Based on this chart it looks like our next high will be around 12000 followed by a low of 4000. Its a very clear textbook head and shoulders effect. People may mess up but this looks like simple momentum to me. I could be wrong, but i would like you to look at the chart and give me your thoughts on this. Maybe even write an article about it. If you can please post this blog instead of my last one.

Just to add a perspective from as far back as Sept 17, 2007:-

http://www.nytimes.com/2007/09/17/business/17greenspan.html

I wouldn’t blame it all on Greenspan. He may have been responsible for how the foundation has been built, the floor plan and the framework of the ‘house’ built up over the decades. Somehow, a change of owner has almost everything messed up.

When the leader of a nation has lost most if not all of his credibility & integrity but still able to get away from it (I am still shocked that Bush can last this long), the rest of the nation will just follow suit. There is very little respect left for work/business ethic anymore.

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The most amazing thing about Alan Greenspan’s being shocked! Shocked!
And more shocked! Is our shock!

Putting himself out for public scrutiny in the heat of this financial imbroglio is a cry of repentance.

With the many Bing Blogs responding to this post, the World seems to know all of the faults of humanity but choose to let the other person repair them.

As long as the electorate of democratic nations continue to play at the electoral casino on election days, the ledgerdemains, wharlocks, witches. and gypsies will play James Brown “I feel good” vctory celebrations for us!!

Judging from this post we’re all playing Eddie Murphy’s “Raw”!

Lesson’s learned: IF IT DON’T MAKE SENSE, IT JUST DON’T MAKE SENSE!!!

“STUPID IS WHAT STUPID DOES” ETC.!

When we point our finger at someone else, is there three pointing back at us??? Think about it?

The International Clown Convention recently held in Mexico City missed a bet by not inviting the higher echelon of our Federal government, especially President Bush (whom I voted for twice), Barney Frank, Christopher Dodd, Alan Greenspan and the other Guardians of the Public Trust who are, at best, guilty of abysmal incompetence, and at worst, criminally negligent. I do not include the institutional banking and ratings characters who sold us down the river. There is nothing funny about them.

Institutionalized Criminals…until the”spiritual malady is overcome, the body and mind cannot follow.”
Then they wonder how Stalin and Hitler were created?
These assholes create them.

Greenspan was shocked that the fox was guarding the henhouse?

Two points:

Sand is GREAT to build on and that tsunami thing you mentioned; That really DID happen. As far as I know, no one was fired.

RETURN TO DESOLATION ROW
(to the Melody of Desolation Row, Bob Dylan)
WilliamBanzai7

They’re selling dark postcards of Wall Street
They’re painting passbooks black
The air is filled with busted banker dread
The circus is in town
Here comes the blind SEC commissioner
They’ve got him in a trance
One hand is tied to the tight-rope walker
The other is in his pants
And the FBI they’re restless
They need somewhere to go
As Lady luck and I look out tonight
From Desolation Row

Bailout Cinderella, she seems so easy
“It takes one to know one,” she smiles
And puts her hands in her back pockets
Bette Davis style
And in comes Wall Street Romeo, he’s moaning
“You Belong to Me I Believe”
And someone says,” You’re in the wrong place, my friend
You better leave”
And the only sound that’s left
After the town car limo goes
Is Bailout Cinderella sweeping up
On Desolation Row

Now the market moon is almost hidden
The economic stars are beginning to hide
The fortunetelling lady
Has even taken all her things inside
All except for Paulson and Bernanke
And the lame hunchback of Pennsylvania Avenue
Everybody is making love
Or else expecting black market rain
And good old Warren, he’s dressing
He’s getting ready for the show
He’s going to the carnival tonight
On Desolation Row

Now Dick Fuld, he’s ‘neath the window
For him I feel so afraid
On his sixty-second birthday
He is just an old Wall Street maid
To him, market death is quite romantic
He wears a pinstripe vest
His profession’s his religion
Sins of greed yet to be confessed
And though his eyes are fixed upon
Noah’s great rainbow
He spends his time peeking
Into Desolation Row

That “Maestro” Greenspan, disguised as Robin Hood
With his memories in a trunk
Passed this way an hour ago
With his friend, a seedy Wall Street skunk
He looked so immaculately frightful
As he bummed a cigarette
Then he went off sniffing drainpipes
And reciting the greek alphabet
Now you would not think to look at him
But he was famous long ago
For playing the free market violin
On Desolation Row

Dr. Bernanke, he keeps his world
Inside a Federal tin cup
But all his terminal patients
They’re trying to blow it up
Now his nurse, some local loser
She’s in charge of the subprime hole
And she also keeps the cards that read
“Have Mercy on their Souls”
They all play on penny whistles
You can hear them blow
If you lean your head out far enough
From Desolation Row

On the Street they’ve nailed the curtains
They’re getting ready for the feast
The Phantom of the Markets
A perfect image of a priest
They’re spoon feeding Hank Paulson
To get him to feel more assured
Then they’ll kill him with their con men skills
After poisoning him with their wily shills
And the Phantom’s shouting to skinny girls
“Get Outa Here If You Don’t Know
Paulson’s is just being punished for going
To Desolation Row”

Now at midnight the GOP led by McCain
And their subhuman neocon crew
Come out and round up everyone
That knows more than they do
Then they bring them to the factory
Where the heart-attack machine
Is strapped across their shoulders
And then the market kerosene
Is brought down from their grand old castles
By insurance men who go
Check to see that nobody is escaping
To Desolation Row

Praise be Roubini’s Neptune
The Titanic sails at dawn
And everybody’s shouting
“Which Side Are You On?”
And Elephant and Donkey Men
Fighting in the captain’s tower
While calypso singers laugh at them
And fishermen hold flowers
Between the windows of the crashing market sea
Where lovely mermaids flow
And nobody has to think too much
About Desolation Row

Yes, I received the bullish newsletter
(About the time the door knob broke)
When you asked how my net was doing
Was that some kind of joke?
All these people that you mention
Yes, I know them, they’re quite lame
I had to rearrange their faces
And give them all another name
Right now I can’t read too good
Don’t send me no more newsletters no
Not unless you mail them
From Desolation Row

How many recessions has he caused while he saved us from inflation?

This is more of a case of greed, corruption and good (very loosly used) intentions.

I wan not shocked, I have been predicting this for years.

I could’ve never imagined that a monument could be shocked by an event that is of a human nature. The Greek columns survive even an earthquake to last until today. So I must suppose that Mr Alan Greenspan is not a monument. At least not the one as sung by Johnny Cash in his famous tune “The Baron”.

On the Bing Blog “Mr. Greenspan is shocked! Shocked!” I read what I expected someone would have the courage to write about.
Was he really shocked or was it just a theatrical performance seeking compassion from the general public and a dwindling number of his followers.
He just preserved a composed face and managed not to weep like a crocodile or like the president Richard Nixon when he was impeached.

For about twenty years he ruled like a magician of Oz. It makes five US presidential time spans. With a touch of a straw like stick Mr Greenspan regulated the course of the steel & concrete rolling power engine of the American super powerhouse. But that power engine colossus, even after losing its empty financial trunks, will go on even without any of them: the empty trunks or that magic wand.

Will Mr Greenspan fade away into the void world of non insignificance replaced by some others? He missed the chance to be venerated as the genius & hero of the financial stability. Who will beat him now?

He presumably expressed some doubts about his own being right or wrong just before leaving the post. He must’ve been scarred about the looming danger that was to be materialized three years later. Sometimes it’s hard to be a man (not a woman as sung by Tammy Wynette) who’s led the economy of the whole world out if its sane track. For what we achieved now is worse than the internet & telecom bubble implosion combined with the Enron catastrophe. No doubt, America will overcome even that, but Mr Ben Bernanke, Mr Greenspan’s successor, will be kept very busy for a moment. I wish he succeeds and I wish he becomes a new colossus of the financial world such as we expect him to be. I wish I could forget about that Great Illusion that is to haunt me after so many years of that fictional financial progress.

What bothers me even more is that the noble profession of the accountants made it clear at least four years ago that the infamous financial “System” is destined to collapse. Some articles backing the danger of an eventual hard stop were already presented on the pages of the Fortune magazine.

Now as Mr Hank Paulson said, they have worked for one hard week to achieve what was not even achievable through a two years’ period time of a normal job.
I just wonder what kind of a job it is, where you can squeeze two years’ period into one week time.
Magic!

… copied from my blog