SAN DIEGO, Jan. 3 (UPI) -- Federal Reserve Chairman Alan Greenspan Saturday told a meeting of economists in San Diego that Fed policy helped the economy survive the tech bubble.
With markets keenly watching Greenspan for any clue as to when the Fed might start raising interest rates, he chose to stick to a history lesson in a speech before the annual meeting of the American Economic Association.
"Tentatively," the Fed seems to have been "successful" in combating the aftershocks of the late '90s high-tech "bubble," he said.
Greenspan said the Fed has been following a precautionary "risk management" strategy that has dictated following a policy that ordinarily would be considered "too loose," to insure against the unlikely but potentially disastrous risk of deflation, Market News International reported.
He repeated his belief that it is "an illusion" to think that the
Fed could have preempted that tech bubble to begin with through a tightening
of monetary policy without damaging the economy in the process.
