QUOTE:
“Greenspan says U.S. “on the edge” of recession
By Anna Driver and Eileen O’Grady Reuters
Published: February 15, 2008
HOUSTON: Former U.S. Federal Reserve Chairman Alan Greenspan on
Thursday said the U.S. economy is “clearly on the edge” of a
recession.
Greenspan said the economy will continue to erode until there is
a stabilization of U.S. housing prices.
“We have a long way to go” before housing prices hit a bottom,
Greenspan told energy executives at the CERA conference.
High oil prices are dragging on the economy, but the fact that
they haven’t done more damage shows its resiliency.
“It’s a burden now,” Greenspan said. He added that it’s “quite
remarkable” that the U.S. economy is “able to do reasonably well”
with oil prices near historic highs.
Crude oil futures hit above $95 a barrel on Thursday and went
above $100 in early January.
Greenspan again — as he had last month — said that the
likelihood of the U.S. economy going into recession was “50 percent
or better.”
He said the U.S. economy was growing at “stall speed.”
“Stagflation is too strong a term for what we are on the edge
of,” Greenspan said.
The subprime mortgage crisis would already have put the United
States into recession if U.S. businesses weren’t healthy in part as
the result of years of low interest rates, Greenspan said.
“If businesses weren’t in extraordinarily good shape, I have no
doubt we wouldn’t be asking if we’re in a recession, but how long
and how deep,” Greenspan said.
“Obviously, they (businesses) are not pushed for credit,” said
Greenspan.
Banks have cut back lending and will continue tight controls on
borrowing until housing prices backed by subprime mortgages
stabilize, said Greenspan.
Greenspan made his comments in response to questions by Daniel
Yergin, chairman of CERA.
Greenspan said he would like to see additional use of electric
cars.
Nuclear power makes the “most sense” to increase U.S. power
generation when all trade-offs are weighed, he said. “We have to
use nuclear,” Greenspan said.
He said more discussion is needed before any “cap” is created as
part of a U.S. cap-and-trade carbon program.
A carbon cap would likely lead to lower economic activity and
higher unemployment if one were set before emissions-cutting
technology is widespread, Greenspan said.
Greenspan said he doubted that technological advances will solve
the problem of growing carbon dioxide emissions.
“If you don’t have a significant amount to trade, a lot of
people won’t be able to trade and won’t have the energy they need,”
Greenspan said.
(Additional reporting by Erwin Seba in Houston; writing by
Bernie Woodall; Editing by Gary Hill)”
UNQUOTE
Study how Greenspan will resolve the many economic and social
problems as compared with our own Finance Minister’s
perspective.
For years we have seen our Finance Minister’s speeches in
parliament during presentation of annual budget. It is a partial
budget based on Incomes & Expenditure concept without revealing
huge capital gains and extraordinary profits made by all
corporatized basic services which stayed concealed year after year
giving a distorted view of our surplus or deficit.
Now let us look at the annual incomes and expenditures for 2007
audited account again. Has it contained the Billions chalked up by
state land sales, HDB flat sales, JTC land/property sales, URA and
LTA sales and all the proceeds from transfer of people’s assets of
lands and infrastructures taken over by GLCs upon corporations or
privatizations to withhold or cut down government tax spending on
basic services to the people?
The extraordinary capital gains made by SLA, HDB, URA have
amounted to some $6 billions as reported sometime in 2007.
Has this figure been included in the bottom line of the annual
budget?
Singapore government’s traditional annual budget is so far at
best a white-wash or window dressing or creative accounting like
NKF has done and is not something really creative or strategic
enough to drive the economy.
It is reactionary responding to criticisms and trying to patch
up unhappiness a bit here and a bit there with a bit of
goodies.
To solve the perennial rising costs of living and the stagnated
median wages for prolonged periods now since the 1997 financial
crisis it is time for our new Finance Minister to present his
annual budget reflecting the full incomes with information showing
cuts in spending on essential government services due to
corporatisation so as to make the tax burdens less onerous and more
sustainable (since basic services are progressively passed to GLCs
charging full market fees) for the longer term.
The whole Annual Budget should be transparent and not hide any
hidden profits or extraordinary gains made by SLA or HDB due to
double-charging on lands and infrastructures already paid for by
citizens with past tax monies.
Try to eliminate all the hidden profiteering schemes through
GLCs put in place by previous government under LKY which so far GCT
nor LHL has failed to solve.
Government is elected to serve the people and solve their
problems of living, working and competing for a job in this
world.
Establish a people-centred annual budget to address root causes
of our problems.
Do not hide profits made by SLA, HDB or URA from lands and
infrastructures and assets already owned by them and funded by
taxes.
Do not double-charge on lands and assets in respect of basic
services like medical care, transportation, utility,
telecommunication, public and welfare institutions.
Adopt a master economic planning strategy as recommended by
Greenspan to save on energy bills and maximise our surpluses to
benefit our job creations rather than giving away jobs to UBS or
Citibank or Shin Corp.
existing resources to help save costs of operations and off
rising inflation and energy costs.
Pass back all such savings including returns from surplus
investments and plow back such profits in the form of endowment
funds to prevent any further over-taxing and back-charging and
under-spending thereby stalling our economic competitiveness.
Since ministers are being paid fullest market salaries (for bill
collector jobs) the government should do away with their life
pensions which will be a great burden to the people.
As long as the median income is stagnated at around $2000.00 pm,
ministers and civil servants should not rely on artificial
arbitrary devices like NWC or their own parliamentary votes to
increase their salaries by 7-14% as clearly people are being left
behind as against the PAP election manifesto or our national
pledge.
