Greenie: "IT WASN'T ME!!!"
In today's WSJ, Alan Greenspan says blame the Chinese, not him, for the low interest rates that fueled the housing bubble. Yes the Fed funds rate was low and far lower than the Taylor rule would have set it, but mortgage rates and monetary policy had become "decoupled". Mortgage rates were not low because of easy monetary policy, they were low because of the Chinese savings glut!
People, I am not making this up. You can read it from the great equivocator's own word processor right here.
He basically says that even if the Fed had tried to tighten policy it wouldn't have affected any investment relevant interest rate. Hmmmm, so Alan, should we just get rid of the Fed then??
This is a new low, even for Greenspan. Yes, he says, monetary policy was too loose by any traditional standard but it didn't have anything to do with the bubble because monetary policy also happened to be completely irrelevant at the time. The former "second most powerful person in the world" now is claiming that he was actually powerless.