Greenspan disputes view that Fed left rates too low for too long

03/19/2010 | Wall Street Journal, The

Alan Greenspan, former chairman of the Federal Reserve, acknowledged that many regulatory failures contributed to the financial crisis, but he said the Fed's policy of low interest rates was not a factor. "We had been lulled into a sense of complacency by the modestly negative economic aftermaths of the stock market crash of 1987 and the dotcom boom," Greenspan wrote in a paper. "Given history, we believed that any declines in home prices would be gradual. Destabilizing debt problems were not perceived to arise under those conditions."

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