Greenspan's Coda

The biggest story today? Not the slam dunk Supreme Court nominee. Not Hurricane Emily. Not Karl Rove.

This is Federal Reserve Chairman Alan Greenspan's final testimony to the House Financial Services Committee. This is history. This is an end of an era. In 2006, we will have a new Fed Chairperson.

This is Greenspans' swan song, his coda, if you will.

What's Greenspan got to say?

"Our baseline outlook for the U.S. economy is one of sustained economic growth and contained inflation pressures. In our view, realizing this outcome will require the Federal Reserve to continue to remove monetary accommodation."

"The data released over the past two months or so accord with the view that the earlier soft readings on the economy were not presaging a more serious slowdown in the pace of activity."

"Employment has remained on an upward trend, retail spending has posted appreciable gains, inventory levels are modest, and business investment appears to have firmed."

"Household spending--buoyed by past gains in wealth, ongoing increases in employment and income, and relatively low interest rates--is likely to continue to expand."

On growing incomes:

"We have an over-supply of high-skilled jobs and an under-supply of people to fill them, the effect of which is to create a significant acceleration in average incomes of the highly skilled segment of our labor force," Greenspan told the House of Representatives Financial Services Committee.

"That, as you recall, I attribute to the fact that we've been unable in our educational institutions to move our younger people sufficiently quickly from grade four through high school into college and beyond at a pace which would create an adequate supply of the number of skilled workers which we need, which incidentally would bring the wage increases down but also simultaneously remove an excess of lesser-skilled workers."