All this sage advice after letting the banking industry bury everyone in debt.... second mortgages for well over the value of the home, saturating the home budgets to a point where many people are paying almost nothing toward the loan principle, almost all interest on credit cards. Financing people no matter how bad their credit history or thier ability to repay...
Now they caution people to be carefull when for many its way too late.
Things will get real bad for those who fell sucker to the easy financing and many will continue to lose thier homes and visit bankruptcy.
Let's see. Greenspan keeps low interest rates, because he wants companies to borrow to create jobs. The government is borrowing money like there is no tomorrow. But they want the consumer to not borrow money.
The spiral of economic decay starts with the assumption regarding the future. Greenspan is seeking to reach the masses to tell them to be prudent so bad news does not occupy the media spotlight. However, the very fact that he mentiones an issue creates the sense that a problem is afoot and causes an abundance of prudence by many while in many areas dependent on normal prudence levels their economics suffer. Greenspan should have a pseudo speak for him so it comes from a reasonable source but, not the FED Chairman.
I don't recall Greenspan encouraging people to borrow or spend on credit, I do however remember him warning against "irrational exhuberance" concerning the Stock Market in the latter half of the '90's. IOW, I don't think he's changing his tune, although I could have missed something.