Pariah Watch: Alan "Borrow on Your Home" Greenspan says the U.S. has borrowed too much money

[marmar]

June 18 (Bloomberg) -- Former Federal Reserve Chairman Alan Greenspan said the U.S. may soon face higher borrowing costs on its swelling debt and called for a “tectonic shift” in fiscal policy to contain borrowing.

“Perceptions of a large U.S. borrowing capacity are misleading,” and current long-term bond yields are masking America’s debt challenge, Greenspan wrote in an opinion piece posted on the Wall Street Journal’s website. “Long-term rate increases can emerge with unexpected suddenness,” such as the 4 percentage point surge over four months in 1979-80, he said.

Greenspan rebutted “misplaced” concern that reducing the deficit would put the economic recovery in danger, entering a debate among global policy makers about how quickly to exit from stimulus measures adopted during the financial crisis. U.S. Treasury Secretary Timothy F. Geithner said this month that while fiscal tightening is needed over the “medium term,” governments must reinforce the recovery in private demand.

“The United States, and most of the rest of the developed world, is in need of a tectonic shift in fiscal policy,” said Greenspan, 84, who served at the Fed’s helm from 1987 to 2006. “Incremental change will not be adequate.” ..........(more)

The complete piece is at: http://www.bloomberg.com/apps/news?pid=20601010&sid=aga_wkgMEfDo

[jtuck004]

1. Greenspan admits ‘mistake’ that helped crisis

http://www.msnbc.msn.com/id/27335454/


Yup, that's who we want to get advice from...

[jwirr]

2. From personal circumstances I know that there is a time when you

are too far in debt and will never be able to pay it off. That is from an individual point of view but I do not know if that applies to governments as well.

[marmar]

3. No doubt....but the irony of Greenspan saying that is a bit thick.

nt

[county worker]

4. That's because you can't increase your income.

Governments and raise taxes and print money.

[Catherina]

5. Borrowed? What an idiot. How about PRINTED?

All of this is hocus pocus to make it seem that we the people borrowed too much too and it's time for everyone to tighten their belts because we're all in the same boat ho-ho-ho, hearty laugh, ho ho ho.

The process of capitalistic growth goes something like this: all money is distributed through banks.

It cannot come from anywhere else. Since banks charge interest, the bank might lend me £1 million and get back £2 million.

This extra money has to come from somewhere but money can only be distributed through banks.

So more money has to be created.

This means that a capitalist economy must continually grow or else it will collapse. So it keeps growing, eventually expanding into every area of life, the way an expanding bubble in your living room will eventually fill your entire house. These areas of life inevitably include weapons production and exploiting fossil fuels, among other nasty activities. But since banks have to make profit, someone continually loses out from this growth. This could be on a micro level of you going bankrupt, or on a macro level of your country being forced into a harsh structural adjustment program, thrusting the majority of the population into poverty. There are infinite possibilities for how people can lose out from this process, including humanity ceasing to exist. This is also the reason why imperialism and war are necessary parts of capitalism.

http://anarchismtoday.org/Blogs/display/id=36.html