I saved my readers again. Yes, I listened to Alan Greenspan testify before Congress so that others would not have to—not the whole thing, only Congressional assistants get stuck with that. But I listened to the questions and answers session, which is really the best part (I have a dull life, I guess). He said not to be concerned about some signs of slowing, and that the economy would be yet stronger next year (I’m not so convinced). The Fed, according to Greenspan, would continue to dribble interest rate hikes on the economy as needed (which I think is too slow).

The Fed persists in its thinking that there is enough slack in the economy that it need not be too worried about inflation using their measures (that counts even out of date, unproductive equipment) and employment (still watching the payroll report and not the household survey, which is much more bullish and picks up small and new businesses much more effectively—and a lot sooner than the payroll survey).

Questions from the various committee members revolved around education (yes, now he is supposed to be an expert on that, and he wanted no part of it) and employment. The latter will start booming very soon, he says (not really). The outsourcing topic came up again (see also my notes below about Macworld in Boston), and he reminded Congress of how outsourcing is part of trade and goes both ways, and it helps the economy grow by deploying resources to other sectors. Greenspan said that the skewering of White House economist Greg Mankiw earlier this year was “unfortunate.” The White House, instead of standing up for Mankiw, shuffled him aside (Mankiw also made comments about new technology and manufacturing which were grandly misinterpreted and distorted by the press and commentators around the same time).