The Fed's "meeting" in Jackson Hole

If you have not been watching the annual Central Bank meeting (sponsored by Kansas City Fed) taking place in on in Jackson Hole, you have missed a great deal.

A few highlights:

The NY Times reports on Greenspan's own comments:

"Fed chairman implicitly took aim at both the torrid run-up in housing prices and at the broader willingness of investors to bid up the prices of stocks and bonds and accept relatively low rates of return.

Both trends reflect what Mr. Greenspan said was the increased willingness of investors to accept low "risk premiums, a willingness based on a complacent assumption that the low interest rates, low inflation and strong growth of recent years are likely to be permanent."

The Seattle Times furthers these comments:

"Greenspan, however, said people shouldn't count on that paper wealth, which can evaporate if economic conditions deteriorate rapidly.

"What they perceive as newly abundant liquidity can readily disappear," he said. "Any onset of increased investor caution" could cause home and stock prices to drop, he noted.""

While the London Times is a bit harsher saying that the US is heading for house price crash:

"In a pre-retirement speech to fellow central bankers at Jackson Hole, Wyoming, Mr Greenspan said that people were investing in houses as if they were a one-way bet, not allowing for the risk of price falls. He said “history had not dealt kindly” with investors who kept ignoring risks."...."Mr Greenspan’s comments were reminiscent of his 1996 inveighing against “irrational exuberance” on the stock market...."

Much time has also been spent on looking back at Greenspan's reign and looking ahead to who will be the next chairperson when he retires in January. For instance, Reuters reports on Robert Rubin's comments:

"Former U.S. Treasury Secretary Robert Rubin, lavish in his praise for Federal Reserve Chairman Alan Greenspan, said Friday his successor should be market savvy because large problems may lie ahead...."Looking forward, our loss over recent years of the fragile political coalescence around fiscal discipline, our currently projected 10-year fiscal deficits...our extremely low personal savings rate and high levels of personal debt, all suggest that the next Fed Chairman could face -- at some point in the future, there's no way of knowing whether it is years out or sooner -- an even greater need for the understanding and experience to deal with serious market difficulties""

And the conference is not even over yet!