Greenspan offers praise for Yellen

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Associated Press

Posted on October 21, 2013 at 6:02 PM

WASHINGTON (AP) — Former Federal Reserve Chairman Alan Greenspan has words of praise for President Barack Obama's choice to lead the Fed.

Greenspan tells The Associated Press that there were times when he would go to Janet Yellen for explanations of what academics were saying about certain economic issues. He calls Yellen "very sharp" and "unquestionably qualified" for the job of Fed chair.

One thing Greenspan won't comment on, however, is the Fed's $85 billion-a-month bond purchasing program. He says it's not a good idea for Fed policymakers to have "somebody harking over their shoulders."

Greenspan does say that the size of the Fed's balance sheets, which stands at a record $3.7 billion, is a concern. He says it has to be reined in "well before the demand for funds picks up and makes it very difficult." Though he adds, he doesn't see inflation as an immediate threat.

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APPHOTO WX203: This photo taken Oct. 18, 2013 shows economist Alan Greenspan in his office in Washington. For 18½ years as Federal Reserve chairman, he was rhapsodized for helping drive a robust U.S. economy. Yet soon after he stepped down in 2006, public judgment reversed course: He was engulfed by accusations that he helped cause the 2008 financial crisis — the worst since the 1930's. Now, Greenspan has struck back at any notion that he — or anyone — could have known how or when to defuse the threats that triggered the crisis. He argues in a new book, "The Map and the Territory," that traditional economic forecasting is no match for the irrational risk-taking that can inflate catastrophic price bubbles in assets like homes or tech stocks. Greenspan, now 87, work as a private consultant. The former chief of America's monetary policy, now 87, writes about the difficulty of predicting economic problems in his new book: "The Map and the Territory: Risk, Human Nature, and the Future of Forecasting." (AP Photo/J. Scott Applewhite) (18 Oct 2013)

<<APPHOTO WX203 (10/18/13)££

APPHOTO WX202: This photo taken Oct. 18, 2013 shows economist Alan Greenspan in his office in Washington. For 18½ years as Federal Reserve chairman, he was rhapsodized for helping drive a robust U.S. economy. Yet soon after he stepped down in 2006, public judgment reversed course: He was engulfed by accusations that he helped cause the 2008 financial crisis — the worst since the 1930's. Now, Greenspan has struck back at any notion that he — or anyone — could have known how or when to defuse the threats that triggered the crisis. He argues in a new book, "The Map and the Territory," that traditional economic forecasting is no match for the irrational risk-taking that can inflate catastrophic price bubbles in assets like homes or tech stocks. Greenspan, now 87, work as a private consultant. The former chief of America's monetary policy, now 87, writes about the difficulty of predicting economic problems in his new book: "The Map and the Territory: Risk, Human Nature, and the Future of Forecasting." (AP Photo/J. Scott Applewhite) (18 Oct 2013)

<<APPHOTO WX202 (10/18/13)££

APPHOTO WX201: This photo taken Oct. 18, 2013 shows economist Alan Greenspan in his office in Washington. For 18½ years as Federal Reserve chairman, he was rhapsodized for helping drive a robust U.S. economy. Yet soon after he stepped down in 2006, public judgment reversed course: He was engulfed by accusations that he helped cause the 2008 financial crisis — the worst since the 1930's. Now, Greenspan has struck back at any notion that he — or anyone — could have known how or when to defuse the threats that triggered the crisis. He argues in a new book, "The Map and the Territory," that traditional economic forecasting is no match for the irrational risk-taking that can inflate catastrophic price bubbles in assets like homes or tech stocks. Greenspan, now 87, work as a private consultant. The former chief of America's monetary policy, now 87, writes about the difficulty of predicting economic problems in his new book: "The Map and the Territory: Risk, Human Nature, and the Future of Forecasting." (AP Photo/J. Scott Applewhite) (18 Oct 2013)

<<APPHOTO WX201 (10/18/13)££

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