Greenspan Sees Turmoil Similar to 1987, 1998: WSJ
By Reuters | 07 Sep 2007 | 04:18 AM ET function UpdateTimeStamp(pdt) {
var n = document.getElementById("udtD"); if(pdt != '' & n &
window.DateTime) { var dt = new DateTime(); pdt = dt.T2D(pdt);
if(dt.GetTZ(pdt)) {n.innerHTML =
dt.D2S(pdt,((''.toLowerCase()=='false')?false:true));} } }
UpdateTimeStamp('633247498873800000');
Former Federal Reserve Chairman Alan Greenspan said the current market
turmoil is "identical" in many ways to that which occurred in 1987 and 1998,
the Wall Street Journal reported in its online edition on Friday.
"The behavior in what we are observing in the last seven weeks is identical
in many respects to what we saw in 1998, what we saw in the stock-market crash
of 1987," Greenspan was quoted by the newspaper as saying.
He made the comment on Thursday at an event in Washington organized by the
Brookings Papers on Economic Activity, an academic journal, the report said.
Greenspan, now a consultant but who was Fed chairman from 1987 to 2005, said
business expansions are driven by euphoria and contractions by fear, the report
said.
While economists tend to think the same factors drive expansions and
contractions, "the expansion phase of the economy is quite different, and fear
as a driver, which is going on today, is far more potent than euphoria," the
report said.
Hedge fund Long-Term Capital Management controlled $100 billion of assets in
1998 but collapsed in the wake of a Russian debt crisis, wreaking havoc in many
derivatives markets.
---------------------------------
Ready for the edge of your seat? Check out tonight's top picks on Yahoo! TV.
