Greenspan: U

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					Greenspan: U.S. Federal Reserve's performance in the crisis failed
According to foreign media reported yesterday, former Federal Reserve
Chairman Alan Greenspan (Alan Greenspan) said in a recent financial
crisis, the Fed and other regulators of the performance of the United
States are "unqualified" in the financial system because of
their the issue of risks to be too complacent.
Greenspan on Friday by the Brookings Institution (Teh Brookings
Institution) addressed a meeting, said: "Even in the private
sector risk management system crash, if we are the second line of
defense against the crisis - that is, we financial regulatory system -
the ability to operate effectively, it also had the financial system
should be able to hold together. However, the pressure in the latest
crisis, the regulatory system also collapsed. "
Greenspan said he and other members of the Federal Reserve failed to
fully understand the extent of the housing market bubble. He was in
October 2008 testified to Congress that, after a "only once in a
century credit tsunami" after the "free market" concept
could be overshadowed.
Greenspan said the time in recent decades, the regulatory agency
officials and managers of financial institutions have seen a more
moderate recession cycle, so they did not expect the crisis will last
only one hundred years of severe to point, this "led to financial
intermediaries serious shortage of capital; can be assumed that the
situation of capital shortage is the result of private sector risk
management system, the main reason for failure."
Greenspan also pointed out that the increase of bank capital and
liquidity requirements will help to reduce future crises, but can not
completely eliminate the crisis, which he echoed the remarks
yesterday.
Greenspan had said on Thursday that regulators may need to force banks
to raise the level of its reserves up to 40%. In his view, and
compared the development of new regulatory rules, which may be to
ensure the stability of the financial system more effective way. He
pointed out that the bank's capital base should be high enough to
prevent similar to the bankruptcy of Lehman Brothers and Bear Stearns
acquired by JPMorgan Chase events.
Thursday also cited the Federal Reserve Alan Greenspan failed to
control the housing market bubble and the size of the largest banks,
said the fact that growth should not be attributed to lower interest
rates bubble levels, but should be attributed to regulatory agencies.
He also pointed out that the largest U.S. bank may need to hold a
special bond, such bonds may decline in the level of bank liquidity
and automatically converted into equity capital. (Jin-liang)