11.20.2004
Greenspan Warns That U.S. Deficits Pose Risk to Dollar (NYTimes.com)
By MARK LANDLER
Published: November 19, 2004
FRANKFURT, Nov. 19 - Alan Greenspan came to the home of the euro today and warned anxious Europeans to expect little relief from the relentless decline of the dollar against their currency.
In a speech to a banking congress here, Mr. Greenspan, the chairman of the Federal Reserve, said the United States' persistently high current-account deficit in world trade posed a risk to the dollar's value, since foreign investors would eventually resist buying more American assets.
"It seems persuasive that, given the size of the U.S. current-account deficit, a diminished appetite for adding to dollar balances must occur at some point," he said. "But when, through what channels, and from what level of the dollar? Regrettably, no answer to these questions is convincing."
Mr. Greenspan likened predicting the dollar's path to "forecasting the outcome of a coin toss."
(More ... The New York Times > Business > Greenspan Warns That U.S. Deficits Pose Risk to Dollar) ¶ 11:15
Published: November 19, 2004
FRANKFURT, Nov. 19 - Alan Greenspan came to the home of the euro today and warned anxious Europeans to expect little relief from the relentless decline of the dollar against their currency.
In a speech to a banking congress here, Mr. Greenspan, the chairman of the Federal Reserve, said the United States' persistently high current-account deficit in world trade posed a risk to the dollar's value, since foreign investors would eventually resist buying more American assets.
"It seems persuasive that, given the size of the U.S. current-account deficit, a diminished appetite for adding to dollar balances must occur at some point," he said. "But when, through what channels, and from what level of the dollar? Regrettably, no answer to these questions is convincing."
Mr. Greenspan likened predicting the dollar's path to "forecasting the outcome of a coin toss."
(More ... The New York Times > Business > Greenspan Warns That U.S. Deficits Pose Risk to Dollar) ¶ 11:15
