Greenspan's mea culpa

Alan Greenspan is quoted in the NY Times

“While I was aware a lot of these practices were going on, I had no notion of how significant they had become until very late,” he said in an interview to be broadcast Sunday on CBS’ “60 Minutes.” ”I really didn’t get it until very late in 2005 and 2006.”

Set your DVRs. His book comes out on Monday.

UPDATE: The book was scheduled to be released on Monday. Apparently someone didn't get the memo. The Wall Street Journal went shopping...

The book is scheduled for public release Monday. The Wall Street Journal bought a copy at a bookstore in the New York area.

And thus, journalistically, it is fair game.

Many economists say the Fed, by cutting short-term interest rates to 1% in mid-2003 and keeping them there for a year, helped foster a housing bubble that is now bursting. In his book, which was largely written before much of the recent turmoil in credit markets, Mr. Greenspan defends the policy. "We wanted to shut down the possibility of corrosive deflation," he writes. "We were willing to chance that by cutting rates we might foster a bubble, an inflationary boom of some sort, which we would subsequently have to address....It was a decision done right."

So he admits to 60 Minutes that he "didn't get it" when it came to the subprime debacle, but he defends the the decision to keep rates low.

Can't wait to see the interview and read the book.

Best line from the article:

Mr. Greenspan recalls his amazement when an adviser to Russian President Vladimir Putin asks him to discuss Ayn Rand, the libertarian philosopher with whom Mr. Greenspan had been friends.

Wish I could have heard that conversation.

Mark Thoma and Felix Salmon have much more.