Bubbles

If only the housing bubble were as strong as the bubble around Bush.

Outgoing Federal Reserve Chairman Alan Greenspan on Friday warned that America's exploding budget deficit and a protectionist backlash against soaring trade deficits could disrupt the global economy.

He said U.S. deficits are set to soar with the pending retirement of 78 million baby boomers and he suggested that Congress consider trimming Social Security and Medicare benefits because the government probably has promised more than it can afford, especially in health benefits.

If something isn't done to trim benefit costs, the resulting budget deficits would "cast an ever-larger shadow" over the future living standards of Americans,
Greenspan said in a taped speech delivered to a conference sponsored by the Philadelphia Federal Reserve Bank.

In contrast to Greenspan's worries about future threats to the economy, President Bush on Friday went to the White House Rose Garden to highlight a new report showing that the labor market was rebounding strongly from the impact of recent hurricanes, creating 215,000 jobs last month.

"We have every reason to be optimistic about our future," Bush said.

Whom do you believe?