Greenspan: Don't Use Fed As A "Magical Piggy Bank"

[katty]

(how dare he...too late, dude!!!)

more: http://www.huffingtonpost.com/2008/09/05/greenspan-dont-use-fed-as_n_124130.html

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Greenspan: Don't Use Fed As A "Magical Piggy Bank"
JEANNINE AVERSA | September 5, 2008 12:02 AM EST |

In a new epilogue, Greenspan says Congress needs to give the government new powers to handle troubled companies to minimize any potential losses to American taxpayers.
(AP Photo/Bizuayehu Tesfaye, file)

WASHINGTON — Troubled by the Bear Stearns debacle, former Federal Reserve Chairman Alan Greenspan is advocating a new way of dealing with government bailouts of companies whose sudden collapse could wreak havoc on the country's economic and financial stability.

Greenspan says Congress needs to give the government new powers to handle troubled companies to minimize any potential losses to American taxpayers. A self-described libertarian Republican, Greenspan has a reputation for being wary of giving the government extra powers. However, in crisis situations, there needs to be a clear process for handling bailouts, rather than depending on the Fed to do so, he reckons.

A high-level panel of financial officials should be given broad authority to quickly determine whether a failing company poses a sufficient threat to the entire U.S. economy, he recommends. If so, the company would be shut down.

[closeupready]

1. This is so dumb. Congress ALREADY has power to do things in a crisis. That's not the problem.

There need to be more effective regulations put in place in order to head off crises at all.

[katty]

3. yup

[EFerrari]

2. Shouldn't use you as a genius, either, Alan, except for your corrupt buddies. n/t