Let me first follow up on your transparency assessment. I think Cathy Minehan has raised an interesting point. I would say this: We run the risk, by laying out the pros and cons of a particular argument, of inducing people to join in on the debate, and in this regard it is possible to lose control of a process that only we fully understand. We have a ratchet in here where, if we were to move forward, we can't go back. So the concept of transparency is a very important concept but one that should be approached with a recognition that we cannot move back and forth on it. I'm a little concerned here that by raising certain issues we may not be able to backtrack.Of course, at the time he said his, the U.S. housing bubble was forming. It kind of makes you wonder what the Fed “fully” understood. And it makes you wonder if anything would have turned out differently had the Fed decided to be more open about what was happening and what it thought it was doing.
Tuesday, March 16, 2004
On March 16, Alan Greenspan said the following during a meeting of the Federal Open Market Committee.