Greenspan's message: lawmakers shouldn't get cocky about budget deals and decreasing deficits; the juggernaut economy deserves the credit — and what it giveth, it can surely taketh away. He urged John Kasich and the rest of the committee to start stockpiling budget surpluses, because dark clouds are always gathering. "The law of supply and demand has not been repealed," Greenspan read. "If labor demand continues to outpace sustainable increases in supply, the question is surely when, not whether, labor costs will escalate more rapidly." Translation: inflation still lurks in the heart of the boom. And the Fed is watching.
WASHINGTON: It was "irrational exuberance" all over again Wednesday morning as the Fed chairman browbeat the House Budget Committee and sent the Dow into a 100-point tailspin by eleven o'clock.