Greenspan's Silver Lining

Former Fed chairman Alan Greenspan is confident that the current bloodletting in the bond market will not compel the Chinese government to start unloading its considerable hoard of rapidly depreciating Treasury securities. That's the good news.

The bad news? Greenspan said he was so confident chiefly because China would have a hard time finding anyone to sell its Treasuries to, at least in a volume that would force yields appreciably higher than they already are headed.

Greenspan offered his assessment after speaking at the Commercial Mortgage Securities Association's convention today at the Waldorf-Astoria in Midtown Manhattan.

As Reuters wryly noted, his reassurance on the Treasury market was "hardly the sort of comfort jittery bond investors were seeking."

by Mark Stein