Alan Greenspan's Holding Pattern

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WASHINGTON: Alan Greenspan is in a groove, even if the U.S. economy isn't. In yet another E.F. Hutton-style speech, this time to the National Association for Business Economics, the Fed chairman settled into a mode of mild pessimism that should last him -- and Wall Street, which was yawning on the news Wednesday -- at least through Christmas. The message: The U.S. economy is healthy but slowing down. The moral: Interest-rate cuts, a quarter point at a time, are expected in November, December and on into the spring.

Meanwhile, says Greenspan, the rest of the world is in deeper trouble than ever. As spooked investors worldwide flee to the safety of U.S. Treasury bonds, a "credit crunch," in which loans and investment dollars become prohibitively hard to come by, has officially descended on Asia. "The perception of high risks in emerging markets has left fewer banks and investors willing to lend money," says TIME business reporter Bernard Baumohl, "which makes it that much harder for those economies to recover." One upside for the Fed chairman: He's got a boilerplate speech he can use all winter.