Greenspan Takes to Airwaves with Consumer Advice
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WASHINGTON (Reuters) - At a time of rising consumer debt problems, Federal Reserve (news - web sites) Chairman Alan Greenspan (news - web sites) is taking to television and radio airwaves to urge consumers to be cautious with their finances, the central bank said on Monday.
Greenspan's appearance in a public service announcement -- a first for the central bank head -- comes at a time when the struggling U.S. economy and rising job losses are increasingly squeezing the finances of many Americans.
Personal bankruptcies reached a new high in the 12 months ending March 31, the Administrative Office for the U.S. Courts said last week. Also, the percentage of U.S. home loans in foreclosure hit a record high in the fourth quarter of 2002, the Mortgage Bankers Association of America announced in March.
"Making informed financial decisions about what to do with your money will help build a more stable future for you and your family," Greenspan says in a spot that will also appear in Spanish.
The financial services marketplace is increasingly complex, and consumers need to master basic financial concepts to manage retirement accounts, borrow money, and avoid fraud, Fed Governor Edward Gramlich said at a briefing at the announcement of the ad campaign.
"Educated consumers know how to save for their goals, use credit wisely, and avoid getting in over their heads," Gramlich said.
The ads direct people to consult a Web site, (http://www.FederalReserveEducation.org), for more information.
The widespread availability of high-quality training programs and information for customers made this a good time to promote financial education, Gramlich said.
Gramlich said tests given nationally to high school students showed a surprising poor grasp of financial concepts.
The Fed is promoting common sense financial behavior such as setting financial goals, developing a budget for expenses, saving regularly, and managing credit wisely. The Fed tells customers to shop around for the best deal on purchases and loans and to regularly check credit scores.
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