Greedspan And Bernanke Flap Gums (Again)
Isn't it time for this clown to leave the public stage?
Higher yields reflect investor concerns over “this huge overhang of federal debt which we have never seen before,” Greenspan said in an interview today on Bloomberg Television.
“I’m very much concerned about the fiscal situation,” said Greenspan, 84, who headed the central bank from 1987 to 2006. An increase in long-term interest rates “will make the housing recovery very difficult to implement and put a dampening on capital investment as well.”
Why don't you go on to explain what happens when the yield rises and the government is borrowing and spending at a rate of some 10% of GDP?
That would be a problem, right? It would be an even more serious problem if we took the current GDP (~14 trillion or so) and then accounted for just the on balance sheet guarantees - that is, the total debt (~$12 trillion or so plus the $5 trillion in Fannie and Freddie that Geithner has repeatedly said the Treasury will "backstop" - legal requirement to do so or no.)
This, by the way, is over 120% of GDP for debt, well beyond what is considered "reasonably safe."
This is some sort of "surprise"? It is now worthy of comment by the "Maestro", more than two years into the insane public spending policies of both the previous and this administration? Why wasn't it worthy of comment in 2007? 2008? 2009? This pattern of "how we bail out people" began in 2007, if you recall.