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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: Skeeter Bug who wrote (177863)	1/19/2009 10:52:45 AM
From: Tommaso	Read Replies (1) \| Respond to of 306849

>>>the outright refusal to raise margin interest rates played no role<<, That power belonged to the Federal Reserve, not to Clinton. The Federal Reserve is supposed to be a politically independent agency created by Congress. The prestige of Greenspan at that time--after he dealt with the 1987 crash and again after he helped out Long Term Capital--was such that no one questioned his failure to raise margin rates. When he merely spoke the words "irrational exuberance" he set off a storm of protest from bankers and investment officers. I myself expected a serious bear market starting in 1998, but Greenspan poured out the money. Then he did it again in 1999 to prevent the Y2K "crisis." The Republicans had Clinton somewhat distracted with their impeachment proceedings, even if he had had the inclination, if not the power, to overrule Greenspan. At the time, I expected G.W.B. to inherit a hell of a mess but the Fed kept on intervening with more and more money. They have never stopped, and now it's a lot worse than ever.