Greenspan finally admits he's not invincible

Following months of rhetorical obfuscations reminiscent of his past Federal Reserve meeting minutes that mostly served to deflect mounting criticisms of his now-infamous laissez-faire philosophy, Alan Greenspan finally issued a mea culpa and admitted that he might have been wrong about the housing bubble, although you had to listen closely to catch it. From an L.A. Times story:

Former Federal Reserve Chairman Alan Greenspan told Congress today he was in "shocked disbelief" at the breakdown of credit markets that has triggered "a once-in-a-century credit tsunami" inflicting great damage on the U.S. economy.

"This crisis ... has turned out to be much broader than anything I could have imagined," Greenspan told the House Oversight and Government Reform Committee in his first congressional appearance since financial markets began melting down last month. "Given the financial damage to date, I cannot see how we can avoid a significant rise in layoffs and unemployment."

Greenspan, who stepped down as Fed chairman on Jan. 31, 2006, after nearly 20 years in the position, reiterated comments he made early this year about his surprise that financial markets had allowed the credit crisis to develop. And under questioning he admitted that the crisis showed flaws in his strong free-market ideology .

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