Crude oil and gasoline prices perceived as high are the respective banes of Wall Street and the unconfident consumer. Federal Reserve Chairman Alan Greenspan, on the other hand, is worried about neither:
The economy, which had hit a temporary soft patch from surging energy prices, probably will weather the situation well, Federal Reserve Chairman Alan Greenspan suggested Friday. "The effect of the current surge in oil prices, though noticeable, is likely to prove less consequential to economic growth and inflation than in the 1970s," the Fed chief said in a speech to the Economic Club of New York. ...Greenspan, in a largely upbeat assessment, noted that oil and gas prices have calmed down a bit recently. Private inventories of crude oil in the United States have climbed to their highest level in three years, helping to damp the recent "price frenzy," he said.
Greenspan publicly dismissed oil fears one month ago and, using almost precisely the same phrase quoted here, last year — before the American economy sustained above-average fourth quarter growth. It's a "testament," as Greenspan commended last October, "to the power of markets and the technologies they foster."