Quote:
Originally Posted by Rickm505
Two words... Alan Greespan. This guy did it almost single handed. First, in reacting to 9/11 he dumped rates 5 points in 12 months. Some could argue this was necessary. What wasn't necessary was keeping them so low for as long as he did. This was the first step in the creation of the housing bubble.
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Started much earlier. Even further back than the southeast Asian currency crisis, but that was a large part of it. When southeast Asian countries were having currency troubles they were dumping piles of money into our financial system to escape their own, our dollar was soaring, our Nasdaq market was soaring, it was the place to be. Remember flattering sayings like "the Russian ruble has turned to rubble" ? Remember when we had a shipping container problem because there were so many foreign imports coming in from cash starved companies to the buyer of last resort that we couldn't find a place to put all the empty shipping containers ?
Start here ...
1997 Asian Financial Crisis - Wikipedia, the free encyclopedia
Then of course there is Greenspan to thank ...
Much of the dollar's change in fortunes started as a trend reversal off of a bottom that had 8$us/barrel oil and economies in South America and Asia that were so starved for cash in the late 90's they were standing in line begging for bailouts. That high dollar (and Yen) were so valuable at the time that they'd buy anything in the world that could be bought. It just couldn't last forever. And it hasn't.
Greenspan money leaving the Nasdaq and moving into a thinning NYSE ...
Then 9/11 2001 and a promise by an American President to fight a war AND not raise taxes ...
Can anyone find 9/11 2001 on this chart ?