Greenspan says flaw in market system AP (10/23/08)

Former Federal Reserve Chairman Alan Greenspan, describing the current financial crisis as a “once-in-a-century credit tsunami” acknowledged Thursday that the crisis has exposed flaws in his thinking and in the workings of the free-market system.

Greenspan told the House Oversight Committee that his belief that banks would be more prudent in their lending practices because of the need to protect their stockholders had been proven wrong by the current crisis. He called this a “mistake” in his views and said he had been shocked by that.

Greenspan said he had made a “mistake” in believing that banks in operating in their self-interest would be sufficient to protect their shareholders and the equity in their institutions.

Greenspan called this “a flaw in the model that I perceived is the critical functioning structure that defines how the world works.”

If I’m not mistaken, Alan Greenspan, High Lord of the Free Market Worshipers, just admitted that unrestrained capitalism doesn’t really work. Kind of a big deal when regulation and accusations of socialism are being bandied about in a Presidential election.

Between Bernanke, Paulson and this moron, I’m starting to think that there’s no good reason that I’m not in the running to be the next Treasury Secretary or Fed Chairman. If Obama wins, it could even be considered a bipartisan nomination.