Making sense of current Economic situation

Last couple of weeks have been a awash with flood of economic news by newspaper articles, TV news, blogs etc. Each of these are full of strange terms and jargon barely making any sense aside the fact of deepening the uncertainty. All the news sources single out a firm like Lehman, AIG or various CEO's to channel the blame, with so much micro look its hard to distill out whats the root cause of all these fiasco. Watch this interesting talk by Robert Reich a Economics professor at UC Berkley, in a short summary he places the single source of blame on Alan Greenspan. He was the Federal Reserve Chairman who during early 2000 reduced Fed borrowing rate to such ridiculous low rate that banks and private heavy weight investors were awash with cheap surplus money. The only way these institutions can make money is by lending to every tom dick and harry whether he needs it not.

Here is a summary talk:
http://fora.tv/2008/10/01/Robert_Reich_Finds_Causes_for_Wall_Street_Meltdown

There is a tab called "Play Full Program" if you want to watch the complete talk.


Venkat Reddy