.WAFL (lXZ lc=0ymdz+ntry(S] :Dd;Gc=0ymdz+'url ehttp://news.ft.com/ft/gx.cgi/ftc?pagename=View&c=Article&cid=FT30I6G6XSC&live=true&tagid=IXLYK5HZ8CCmime text/htmlhntt"c7b23-25f5-3bcde4fa"hvrsdata FT.com | Markets | Business in Brief Article


US growth rate not compromised says Greenspan
By Peronet Despeignes in Washington
Published: October 17 2001 14:41 | Last Updated: October 17 2001 20:42

Alan Greenspan

Alan Greenspan, Federal Reserve chairman, warned on Wednesday that risks following last month's terrorist attacks would impose a burden on the economy but said the economic shock would be temporary.

Mr Greenspan told members of joint House and Senate economic committee that the attacks would likely raise insurance premiums, security and other costs.

He voiced support for the general idea of government assuming some of the risk and insurance costs of future terrorist attacks.

While he did not expect the attacks to drag as heavily on the US economy as the Cold War did, Mr Greenspan said the intense campaign to prevent further attacks would put a "one-time" damper on US productivity growth and living standards, as markets adjusted and resources were diverted from the creation of wealth and consumption to the enhancement of security.

"The level of productivity will presumably undergo a one-time downward adjustment as our economy responds to higher levels of perceived risk," he said.

However, the "prospects for ongoing rapid technological advance and faster productivity growth" were "scarcely diminished".

In what may mark a departure from earlier prognoses, the Fed chairman hinted that productivity growth would return to levels above the 1970-1995 average, but not the rapid rates of the past five years.

Once the economy adjusts to new risks, "productivity growth should resume at rates in excess of those that prevailed in the quarter-century preceding 1995," Mr Greenspan said.

The Fed chairman said the attacks had occurred just when the US was showing "tentative, but encouraging" signs of "stabilisation" from its year-long slowdown. In the immediate aftermath of the attacks, "the level of [economic] activity declined significantly", he said.

"As the initial shock began to wear off, economic activity recovered somewhat... though the recovery has been uneven," he said.

But Mr Greenspan cautioned "nobody has the capacity to fathom fully how the effects of the tragedy of September 11 will play out in our economy". That would become clearer with time, he said.

In response to questions from lawmakers, Mr Greenspan said monetary and fiscal policy alone could not eliminate the risk of recession. He said he supported the reduction - if not elimination - of the capital gains tax, but said it would provide little immediate stimulus.

Separately, the Commerce Department said starts on the construction of new homes rose in September, but failed to erase August's steep losses. Mr Greenspan said the outlook for the housing market was murky.




more from FT.com
Looking ahead: Greenspan to reassure on economy
Lex: US retail sales
US retail sales fall by 2.4% in September
US consumer confidence sinks to five-year low
Attack on Afghanistan special

more from the web
Testimony of Alan Greenspan on the condition of the financial markets September 20
Speech by Alan Greenspan on transparency in monetary policy October 11
Speech by Governor Laurence Meyer on monetary policy October 12



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T  ~Plτƍ;z2ȑ$KwA-YAurl 7http://globalelements.ft.com/Common/Wrapper/FTUtils.jsbsrl/http://news.ft.com/global/Markets/right_columnmimeapplication/x-javascripthntt"b40b4-3fd8-3b8fbad0"hvrsdata// $Id: FTUtils.js,v 1.32 2001/08/31 16:26:56 wai Exp $ // Ad Server Utils var FTDefAdSiteCode = 'ftcom'; // Used to avoid ad call caching function getTransId( ){ var cDate = new Date(); var uSec = cDate.getTime(); return("&transId=" + uSec); } // Get the current domain as a string function getDomainFromURL( fullUrl ){ var tmpStr; var tmpInd = -1; var domain; if( !fullUrl.match ) return(""); tmpStr = fullUrl.match(/^http:\/\//); if( tmpStr && tmpStr.length > 0){ domain = fullUrl.substr(7); } tmpStr = fullUrl.match(/^https:\/\//); if( tmpStr && tmpStr.length > 0){ domain = fullUrl.substr(8); } tmpInd = domain.indexOf('/'); if( tmpInd == -1){ tmpInd = domain.indexOf('\\'); } if( tmpInd > 0 ){ domain = domain.substring(0, tmpInd); } return(domain); } function defined(obj){ var rval = true; if( typeof obj == 'undefined' ){ rval = false; } return(rval); } // Build a URL with document's protocol (e.g. https: or http:) // Note: path should not include protocol or '//' function ftURL(path) { var newurl; if( document.location.protocol.indexOf('http') > -1 ){ newurl = document.location.protocol + '//' + path; } else { newurl = 'http://' + path; } return newurl; } function isSecure(doc) { var loc = ''; var secure = false; if( document.layers && window.ourLoc ){ loc = window.ourLoc; } else { loc = doc.location.toString(); } if( loc.indexOf('https') > -1 ){ secure = 1; } return(secure); } // Get the base domain for the whole document function isFTDomain(){ if( document.domain && document.domain.indexOf(".ft.com") >= 0 ){ return(1); } else { return(0); } } function getBaseDomain(){ var realDomain = ""; if( self == top ){ realDomain= document.domain; } else if( window.ourDom ){ // Set in navigation.js NN only realDomain = window.ourDom; } else if( document.referrer ) { realDomain = getDomainFromURL(document.referrer); } else { // Unable to find base domain realDomain = document.domain; } return(realDomain); } function getRealLoc(){ var realLoc = ''; if( self == top ){ realLoc = document.location.toString(); } else if( window.ourLoc ){ realLoc = window.ourLoc; } else if( document.referrer ){ realLoc = document.referrer; } else { realLoc = document.location.toString(); } return(realLoc); } var sportsLoc = [['11spft','ft.sports.com/football'],['11spru','ft.sports.com/rugby'],['11spcr','ft.sports.com/cricket'],['11spsa','ft.sports.com/sailing'],['11spte','ft.sports.com/tennis'],['11spbo','ft.sports.com/boxing'],['11spgo','ft.sports.com/golf'],['11spfo','ft.sports.com/f1'],['11spto','ft.sports.com/tourdefrance']]; // Get a non ft.com domain code //Sync values with navigation.js function getSiteNav(){ var realDomain; var realLoc = getRealLoc(); var navStr = '&nav='; realDomain = getBaseDomain(); if( realDomain.lastIndexOf("sports.com") > -1 ) { for( var i = 0; i < sportsLoc.length ; i++ ) { if( realLoc.indexOf(sportsLoc[i][1]) != -1 ) { return(navStr + sportsLoc[i][0] ); } } return(navStr + "11spor"); } if( realDomain.lastIndexOf("icbinc.com") > -1 ){ return(navStr + "11anrp"); } switch( realDomain.toLowerCase() ){ case "www.infospace.com": return(navStr + "11info"); break; case "ft.digitalcity.com": return(navStr + "11digi"); break; case "ft.icollector.com": return(navStr + "11icol"); break; case "forums.wellengaged.com": return(navStr + "11well"); break; case "www.ft.monster.com": return(navStr + "11mons"); break; case "209.212.79.15": return(navStr + "11zaga"); break; case "www.ipo.com": return(navStr + "11ipoc"); break; default: return(""); } } var FTTransId = getTransId(); // Unique ID var FTSiteNav = getSiteNav(); // site nav for non ft.com domains // Func: setAdFrameSrc // Desc: IE only sets the IFrame src value // Args: frame = ID of frame to set pos - position code of ad function setAdFrameSrc( frame , pos ){ // Wait until loaded on Mac if( navigator.appVersion.indexOf("MSIE") > 0 && navigator.appVersion.indexOf("Mac") > 0 && document.readyState.indexOf("complete") == -1 ){ var cmd = 'setAdFrameSrc( "' + frame + '" , "' + pos + '" )'; var sec = Math.round(Math.random() * 1000 ) + 1000; //1-2 sec timeout setTimeout( cmd , sec); return; } if( document.layers ){ return; // Not on NN } else { var fSrc = getAdFrameSrc(pos); eval('document.all.' + frame + ".src='" + fSrc + "';" ); } } // Func: getFTSite // Desc: gets the ad site code // Args: none function getFTSite(){ var code = FTDefAdSiteCode; if( typeof FTAdSiteCode != 'undefined' ){ code = FTAdSiteCode; } return(code); } // Func: getAdFrameSrc // Desc: generate the src value for an ad ilayer/iframe // Args: pos - position code function getAdFrameSrc(pos){ var fSrc = 'https://globalelements.ft.com/Common/Wrapper/empty.html'; if( !isSecure(document) ){ fSrc = 'http://ads.ft.com/html.ng/site=' + getFTSite() + '&pos=' + pos + getAdParams(); } return(fSrc); } // Get Extra Params for Ad Server function getAdParams(){ var sAYSC = getCookieValue('AYSC', ''); var params = ''; params += "&13=" + getValueFromStr('_13', '', sAYSC, '_', ''); params += "&14=" + getValueFromStr('_14', '', sAYSC, '_', ''); params += "&17=" + getValueFromStr('_17', '', sAYSC, '_', ''); params += "&18=" + getValueFromStr('_18', '', sAYSC, '_', ''); params += FTSiteNav + FTTransId return(params); } // Func: getAdHTML // Purpose: create and write the ad calls into the current document // has the same limitations as document.write // Args: pos - position code, width/height in pixels function getAdHTML(pos,width,height) { var strLoc=window.document.location.href; strLoc=strLoc.toString(); var keyword_value=''; //if NOT RHN or LHN of Search OR RHN or LHN of Markets if((strLoc.indexOf("totalsearch.ft.com/totalsearch/index.jsp?do=basic&query=")!=-1)||(strLoc.indexOf("&c=Collection&cid=FTDE144CODC&query")!=-1)||(strLoc.indexOf("&c=Collection&cid=IXLSDFNZMDC&query")!=-1)||(strLoc.indexOf("mwprices.ft.com/custom/ft-com/quotechartnews.asp?symb=")!=-1)||(strLoc.indexOf("&c=Collection&cid=IXLZVQRPCDC&symb")!=-1)||(strLoc.indexOf("&c=Collection&cid=IXLC63Q80DC®ion=uk&symb")!=-1)) { var s_term=''; if((location.hostname=='totalsearch.ft.com')||(location.hostname=='search2.ft.com')){s_term='query=';} else if((location.hostname=='mwprices.ft.com')||(location.hostname=='markets.ft.com')){s_term='symb=';} else{s_term='undefined';} s_term=s_term.toString(); var key_index=strLoc.indexOf(s_term); var end_value=strLoc.indexOf('&',key_index); (end_value!=-1)?end_value=end_value:end_value=strLoc.length; (key_index!=-1)?keyword_value='&keyword='+strLoc.substring(key_index+s_term.length,end_value):keyword_value=''; //alert(keyword_value); } if (!isSecure(document)) { if(!document.layers) { adHTML='