US economy may be ruined by 'crazies', warns Alan Greenspan

Former Federal Reserve Chair Alan Greenspan © Yuri Gripas
Former Federal Reserve Chairman Alan Greenspan has expressed deep concern over the current economic and political situation in the US, saying it is the worst he has ever seen.

Greenspan, who ran the Fed from 1987 to 2006 during America's longest economic boom, said the country is headed toward high inflation, high unemployment, and stagnant demand in the economy.

"I hope we all find a way out because this is too great a country to be undermined, by how should I say it, crazies," the 90-year-old economist said at a conference set up by Stanford University and the University of Chicago. Greenspan refused to comment on whom he was referring.

"It is the worst economic and political environment that I’ve ever been related to," he told the audience, stressing that the economy was not in a stable equilibrium.

The growing government spending on social security and healthcare is pushing out private investors and slowing down economic growth, according to Greenspan. He said neither presidential nominee was open to talk about the reining in this expensive item.

"Nobody wants to discuss it" for fear of a political backlash, said Greenspan.