Alan Greenspan, Former Fed Chair, Goes for the Gold

 

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Alan Greenspan, Former Fed Chair CLICK FOR VIDEO

We’ve all heard of  doom-saying economists saying it’s time to stock up on gold against an upcoming financial catastrophe. None of those doom-sayers are a former Chairman of the Federal Reserve Board.

On Wednesday, though, as the Federal Open Market Committee prepared to announce the end of the years-long asset purchase program known as Quantitative Easing, Alan Greenspan, the near-legendary Fed chair whose every utterance used to be parsed by market watchers, spoke before the Council on Foreign Relations and advised listeners that under current conditions, gold is probably a good investment.

According to Wall Street Journal reporter Michael S. Derby, “Mr. Greenspan said gold is a good place to put money these days given its value as a currency outside of the policies conducted by governments.”

Greenspan has been talking up gold in a number of settings lately. But he didn’t stop there in his appearance Wednesday. The Fed was about to make a fairly significant announcement about the end of its QE program, under which it has purchased trillions of dollars in assets in an effort to keep interest rates low and stimulate investment. Greenspan weighed in on that program with some surprising comments.

The former Fed chairman from 1987 to 2006 said the QE program had failed to achieve its primary goals. As a means of boosting consumer demand, the asset purchase program, he said, “has not worked,” though it did a good job of increasing asset prices.

Greenspan’s decision to publicly analyze the effectiveness of the QE program on the day his former colleagues were expected to announce its completion was remarkable, if only because during his tenure as Fed Chair, he was notorious for his desire to give the financial media little or nothing of substance to analyze about the central bank’s decision making process.

 

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