Friday, July 1, 2011

Alan Greenspan declares the stimulus a failure

 The Age of Turbulence: Adventures in a New World

Federal Reserve Governor Alan Greenspan says there is no evidence the stimulus worked. The 9% (18%?) of Americans unemployed figured this out a long time ago.

(CNBC)- The Federal Reserve's massive stimulus program had little impact on the U.S. economy besides weakening the dollar and helping U.S. exports, Federal Reserve Governor Alan Greenspan told CNBC Thursday.

In a blunt critique of his successor, Fed Chairman Ben Bernanke, Greenspan said the $2 trillion in quantative easing over the past two years had done little to loosen credit and boost the economy.

"There is no evidence that huge inflow of money into the system basically worked," Greenspan said in a live interview.

"It obviously had some effect on the exchange rate and the exchange rate was a critical issue in export expansion," he said. "Aside from that, I am ill-aware of anything that really worked. Not only QE2 but QE1."

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