Fed's Greenspan on budget policy

In the speech 'Budget policy' given on 2 December Alan Greenspan of the Federal Reserve said good short-term prospects for the U.S. economy should not distract from huge looming fiscal strains that pose "significant" economic risks.

The soon to depart Fed chief said while U.S. spending on defense and homeland security will not stay at the current pace forever, "our budget position will substantially worsen in the coming years unless major deficit-reducing actions are taken."

"In the end, the

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