Chairman Alan Greenspan

An article in the Business section Sunday incorrectly attributed a response to Sen. Paul S. Sarbanes' use of cartoons to criticize Federal Reserve Board Chairman Alan Greenspan. The response -- "You've certainly elevated the intellectual level of this debate" -- was made by Sen. Phil Gramm, R-Texas.The Sun regrets the errors.

Can you blame Wall Street for being confused? Each mortgage security polluting our economy often holds hundreds of loans from dozens of states. Loans got bundled into layers according to default rates and repayment schedules, each batch dependent on what happened in the others. In case that wasn't squirrelly enough, Wall Street bought and sold insurance contracts whose values were ultimately tied to different parts of the unfathomable mortgage pool. "I'd like to know what those damn things are worth," Federal Reserve Chairman Ben S. Bernanke said a year ago this week.

Blinder joins Fed as vice chairmanEconomist Alan Blinder was sworn in yesterday as vice chairman of the Federal Reserve Board, the Fed said.Mr. Blinder, who was a member of President Clinton's Council of Economic Advisers, was confirmed Friday by the Senate. He replaces David Mullins, who resigned in February.Mr. Blinder, sworn in by Fed Chairman Alan Greenspan at a private ceremony, will participate at the July meeting of the Fed's interest rate-setting Open Market Committee.@

WASHINGTON -- Federal Reserve Chairman Alan Greenspan used personal intuition and wide flexibility to set U.S. interest rates over the past 18 years. And Ben Bernanke, the man chosen to replace him, vowed at his confirmation hearings yesterday to continue Greenspan's policies if he takes over as expected in January. Economists said the differences between the two men will become apparent and will make monetary policy more mechanical than it has been under the 79-year-old Greenspan, who achieved star status as a leading U.S. and world economic figure.

Federal Reserve Chairman Alan Greenspan said the combined $1.47 trillion portfolios of Fannie Mae and Freddie Mac should be reduced and that moving too slowly to do so may disrupt the U.S. financial system. "Excessive caution in reducing their portfolios could prove to be destabilizing to our financial system as a whole and in the end could seriously diminish the availability of home mortgage funds," Greenspan wrote in a Sept. 2 letter to Sen. Robert F. Bennett, a Utah Republican, released last week.

The U.S. economy isn't suffering from a housing bubble, Federal Reserve Chairman Alan Greenspan said last week. Greenspan, answering questions after a speech at the Ronald Reagan Presidential Library and Museum, said that even if price increases do slow, it's "doubtful" that such a slowing would cause major problems in the economy. "I personally don't think that there is a housing bubble," Greenspan said at the Reagan library and museum in Simi Valley, Calif. "I don't deny that, overall, after running up quite a good deal, that the rate of increase in housing prices could slow very dramatically and even decline modestly, but that's not likely to be a major negative force.

WASHINGTON - Federal Reserve Chairman Alan Greenspan's personal financial holdings were valued at $3 million to $6.16 million at the end of last year, according to his annual financial disclosure report. The bulk of Greenspan's assets, $2.5 million to $5 million, were overseen by CIBC Oppenheimer Corp. and were invested almost entirely in U.S. Treasury bills, the statement showed. The Fed chairman also held $400,000 to $861,000 in Treasury bills in direct deposit accounts. Greenspan had $102,000 to $280,000 in savings and checking accounts at the Fed's credit union, in a Fidelity Spartan Money Market Account and in a Merrill Lynch Cash Management Account, according to the report.

FEDERAL RESERVE Chairman Alan Greenspan often sounds like a wet blanket. Last week, Mr. Greenspan again expressed concern over surging stock prices and their possible detrimental impact on what is likely to be the nation's longest economic recovery. Speaking before the Economic Club of New York, Mr. Greenspan returned to his familiar theme: We are witnessing an unprecedented spurt in productivity that has brought the nation extremely low levels of unemployment without inflation and significantly increased national wealth, but pressures are building that may end this trend.

CORAL GABLES, Fla. -- Federal Reserve Chairman Alan Greenspan yesterday applauded efforts in Congress to reduce U.S. government regulation of derivatives and financial futures markets.The central bank chairman offered what may be crucial backing for futures markets in Chicago and New York that are seeking legislation they say will help them recapture business lost to less-regulated over-the-counter markets and overseas exchanges.Greenspan spoke favorably of legislation introduced by Sen. Richard G. Lugar, the Indiana Republican who chairs the Senate Agriculture Committee, which would substantially deregulate U.S. futures and options trading.

FEDERAL RESERVE chairman Alan Greenspan's reputation as a skilled manager of monetary policy is such that Wall Street would have been disappointed had he not raised short-term interest rates by a modest quarter-percent yesterday.He had prepped the markets for such a pre-emptive strike against future inflation beginning with his December admonition against "irrational exuberance" on the part of investors and his warning that soaring share prices could be a factor in overheating the economy.

Federal Reserve Chairman Alan Greenspan said the combined $1.47 trillion portfolios of Fannie Mae and Freddie Mac should be reduced and that moving too slowly to do so may disrupt the U.S. financial system. "Excessive caution in reducing their portfolios could prove to be destabilizing to our financial system as a whole and in the end could seriously diminish the availability of home mortgage funds," Greenspan wrote in a Sept. 2 letter to Sen. Robert F. Bennett, a Utah Republican, released last week.

LONDON - Federal Reserve Chairman Alan Greenspan said yesterday that America's record trade gap might be poised to stabilize and even fall because of market pressures and belt-tightening by the Bush administration. Greenspan was speaking at a gathering here coinciding with a scheduled meeting of the Group of 7 finance ministers and central bank governors who represent the world's leading industrialized nations. His remarks inspired a strengthening of the dollar. The G-7 talks, which end today, are likely to devote much attention to the U.S. trade deficits, the weakness of the dollar and the linkage of China's currency to the dollar, which has propelled the trade deficit by fueling a rapid expansion in Chinese exports.

Federal Reserve Chairman Alan Greenspan told members of the Senate banking committee yesterday that "inflation is not likely to be a serious concern" but that policy-makers are watching the effect of rising energy prices on the world and U.S. economies closely. Bond prices rose after Greenspan's remarks about inflation, continuing a rally that had begun earlier in the day after the release of May consumer price data that were not as bad as many had feared before the report's release. Greenspan spoke at a hearing on his confirmation for a fifth term as chairman of the Federal Reserve Board.

WASHINGTON - Federal Reserve Chairman Alan Greenspan roiled financial markets yesterday by declaring that the threat of deflation is "no longer an issue" and that the economy seems to be strengthening on many fronts. Greenspan's brief but buoyant comments about the economy, during testimony at a Senate hearing, sent shivers through the stock and bond markets, as investors interpreted his words as additional evidence that the Federal Reserve will raise interest rates before the end of the year.

Federal Reserve Chairman Alan Greenspan warned Congress and the Bush administration yesterday that Social Security benefits should be cut to avert serious economic problems from a ballooning budget deficit. "The dimension of the challenge is enormous," Greenspan said on Capitol Hill to members of the House Committee on the Budget. "The resolution of this situation will require difficult choices, and ... the future performance of the economy will depend on those choices." Greenspan indicated that he is in favor of making the Bush administration's sweeping tax cuts permanent despite the rising deficits because raising taxes could "pose significant risks to economic growth and the revenue base."

Federal Reserve Chairman Alan Greenspan offered yesterday his most optimistic outlook for the economy since he took over leadership of the central bank in 1986. And he gave no indication that the Fed is inclined to begin raising short-term interest rates soon. Bond prices moved sharply higher and stocks rose as well after Greenspan made his appearance on Capitol Hill. Greenspan, in his semiannual report to Congress on monetary policy, said "the prospects are good" for a "sustained expansion" of the economy.

WASHINGTON -- Federal Reserve Board Chairman Alan Greenspan said yesterday that the "credit crunch," which has made borrowers into beggars and stifled economic recovery, had finally bottomed out."While the crunch is not easing, it's reached its maximum, and there is some evidence that we may not be too far from a basic softening in it," Mr. Greenspan told the Senate Finance Committee."Credit crunch" refers to the tight lending policies that banks have applied with increasing severity as real estate markets collapsed and regulators restricted high-flying financial activities.

Reuter -- OSAKA, Japan -- Federal Reserve Chairman Alan Greenspan said today that the odds are rising that the U.S. economy could bounce back from the 11-month recession at a stronger rate than many expect."

JACKSON HOLE, Wyo. - Federal Reserve Chairman Alan Greenspan made it clear yesterday that human judgment should reign in the central bank's interest-rate decisions if it is to act swiftly against potential economic risks. In a speech at a Fed conference here, Greenspan argued against proposals that would force the Fed to use a hard-and-fast rule, such as changes in a specific inflation rate, to decide when and how much to change interest rates. Greenspan said the Fed has deliberately shied away from a specific rule to set interest rates because one couldn't adequately respond to economic uncertainties.

The U.S. economy isn't suffering from a housing bubble, Federal Reserve Chairman Alan Greenspan said last week. Greenspan, answering questions after a speech at the Ronald Reagan Presidential Library and Museum, said that even if price increases do slow, it's "doubtful" that such a slowing would cause major problems in the economy. "I personally don't think that there is a housing bubble," Greenspan said at the Reagan library and museum in Simi Valley, Calif. "I don't deny that, overall, after running up quite a good deal, that the rate of increase in housing prices could slow very dramatically and even decline modestly, but that's not likely to be a major negative force.