- Government released revised estimate for Q4 GDP
- Initial estimate was 2.6; revised down to 2.2
- Economic growth dipped from 5% in Q3 to 2.18% in Q4
- PMI was expecting 58.7 but plunged to 45.8, indicating contraction
- Alan Greenspan commented that the U.S. economy is weak
- Greenspan cites declining U.S. productivity
- Points to declining gross domestic savings brought on by entitlement programs
- Greenspan refuses to blame Fed policy for productivity and savings declines
- He predicts continued low interests rates to create the illusion of wealth
- In 1966, Alan Greenspan blamed the Fed and their cheap money policies for stock market bubble and economic imbalances
- Today, he still believes this to be true, but no longer cares about the consequences of reckless economic policy
- The Fed’s job now is to just do whatever it takes to postpone the pain
- Inflating bubbles with the certain knowledge that the outcome will be bad, while pretending that they will eventually raise rates
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