Financial crisis panel to grill Greenspan
Former Federal Reserve Chairman Alan Greenspan will be the star witness at a hearing of the congressional panel looking into causes of the financial crisis, according to people familiar with the situation. The Financial Crisis Inquiry Commission’s three-day session in early April gives commission members a rare opportunity to quiz the man who oversaw federal financial regulation throughout the runup to the crisis in 2008. Greenspan’s role as Fed chairman has come in for criticism since then, but he has seldom been called to testify before Congress. Greenspan’s spokeswoman didn’t respond to a request for comment. The hearing will focus on the explosion of subprime mortgages, and the complex securitizations that Wall Street engineered from those loans. And it will examine the role of government-sponsored mortgage companies Fannie Mae and Freddie Mac. Some experts believe Fannie’s and Freddie’s large presence in the mortgage market, and their appetite for highly rated subprime securities, contributed to the rapid growth of the subprime market. Greenspan frequently raised concerns about the companies’ rapid growth, but Congress didn’t pass legislation to rein them in until the mortgage-market meltdown was well under way.