Does Alan read the Park Paradigm…
…now that he has time to kill in airport lounges waiting for his next book tour stop? It seems that he shares some of the concerns with respect to the Super Credit Rescue Fund that I raised last week…
Alan Greenspan on Friday raised serious doubts over the plan to create a $75bn-plus investment fund to buy the assets of troubled investment vehicles, warning that it could prevent the market from establishing true clearing prices for asset-backed securities.
“It is not clear to me that the benefits exceed the risks,” the former chairman of the Federal Reserve told Emerging Markets magazine. He added, “The experience I have had with that sort of intervention is very mixed.”
(Sean asked last Tuesday:)
Indeed the important medium term ‘$100 billion’ question is just how big are these real underlying losses and how much equity needs to be written off to clear the market. The banks in question are certainly in a good position to have a good understanding of what exactly this number is likely to be. If their management and motivation in setting up this fund is framed around accelerating the accurate repricing and acknowledgement of risk, than they can only be encouraged. If on the other hand, the real underlying driver is simply to reshuffle the deck and keep the dance going (not my metaphor!) then the credit prom might end up looking more like [a scene from Carrie.]
Alan, I’m still waiting for my 2030 innovation prediction to show up on Long Bets* so that you can take the other side. 
(*submitted this a month ago, anyone know anyone at the Long Now Foundation? they seem to be taking a very long time to validate my prediction…)
October 22nd, 2007 at 12:49 am
Sean: I’m a fan of blog, ideas and site. But why on earth do you publish only a partial RSS feed? I cannot read the whole site without clicking through, and as a result I read a lot less often than I would otherwise. Please go to the trouble to change this.
October 22nd, 2007 at 1:09 pm
Thanks Bo, sorry didn’t realize I was only publishing a partial feed. Will try to sort out. Thanks for pointing this out.
October 26th, 2007 at 12:52 pm
[…] I asked last week whether or not Mr. Greenspan might have the Park Paradigm RSS feed streaming into his blackberry; now - according to the FT - it seems Warren might be a fan too - The US banks creating a $75bn-plus “superfund” to buy the assets of troubled investment vehicles should sell 10 per cent of the fund into the open market to ensure it is properly priced, the renowned investor Warren Buffett said on Thursday. […]