The US government may have to nationalise some banks on a temporary basis to fix the financial system and restore the flow of credit, Alan Greenspan, the former Federal Reserve chairman, has told the Financial Times.On the subject of the stimulus package and bank nationalization, he sounds like Paul Krugman now. Alan Greenspan, Objectivist devotee of Ayn Rand and dedicated free market uber alles believer is so scared about the state of the economy he thinks the Democrat's $ 700 billion plus stimulus package plus the billions in the bank rescue plans probably aren't enough to save the world economy.
In an interview, Mr Greenspan, who for decades was regarded as the high priest of laisser-faire capitalism, said nationalisation could be the least bad option left for policymakers.
”It may be necessary to temporarily nationalise some banks in order to facilitate a swift and orderly restructuring,” he said. “I understand that once in a hundred years this is what you do.”
This is one of those things that should be scaring the hell out of you.