Greenspan Sees 1/3rd Probability of Recession
Former Fed Chairman Greenspan has put the probability of a recession in 2007 at 1/3rd.
March 6 (Bloomberg) — Former Federal Reserve Chairman Alan Greenspan said there’s a “one-third probability” of a U.S. recession this year and the current expansion won’t have the staying power of its decade-long predecessor.
“We are in the sixth year of a recovery; imbalances can emerge as a result,” Greenspan, 81, said in an interview yesterday at his office in downtown Washington. “Ten-year recoveries have been part of a much broader global phenomenon. The historically normal business cycle is much shorter” and is likely to be this time, he added.
Wow, and I thought I was on the pessimistic side! This seems like a fairly high probability of recesssion. Sure the housing and auto-industry are not doing great, but so far there appears to be little spill over into the rest of the economy.