In November 2000, during the disputed presidential election won by George W. Bush (excuse the indulgence; I just enjoy typing those words, especially considering the alternative), Dick Cheney and others were (in hindsight, rightfully) pointing to negative indicators in the economy pointing to a possible recession. Furious supporters of what was to become the previous administration accused Cheney of "talking down the economy" -- a charge that was lapped up by the Mainstream Media at the time.
It was nonsense, of course. But if you really believe that a soon-to-be-Vice President can "talk down the economy," a former Federal Reserve Chairman, Mr. "Irrational Exuberance" himself, who may still have at least informal access to information many of us don't, can be fairly accused of the same thing -- can't he?
Here's some of what Greenspan said Monday:
"When you get this far away from a recession invariably forces build up for the next recession, and indeed we are beginning to see that sign," Greenspan said via satellite link to a business conference in Hong Kong. "For example in the U.S., profit margins ... have begun to stabilize, which is an early sign we are in the later stages of a cycle."
"While, yes, it is possible we can get a recession in the latter months of 2007, most forecasters are not making that judgment and indeed are projecting forward into 2008 ... with some slowdown," he said.
Greenspan said that while it would be "very precarious" to try to forecast that far into the future, he could not rule out the possibility of a recession late this year.
Where are those who were on Cheney's case now?
Cross-posted at BizzyBlog.com.
