Greenspan's faith in securities pays off
Associated Press
WASHINGTON — Federal Reserve Chairman Alan Greenspan, who once worried out loud about "irrational exuberance" in the stock market, demonstrated last year that a conservative approach to investing can pay off.
Associated Press
Greenspan's portfolio, heavily invested in safe Treasury securities, avoided the big losses suffered by many stock investors, according to his annual disclosure form, released yesterday by the Fed.
Disclosure rules do not require exact figures, but Federal Reserve Board Chairman Alan Greenspan's assets, at the maximum level, may be $9.6 million. He has no stocks.
The federal disclosure form does not require a listing of exact values for assets held, only ranges. Greenspan's assets begin in the less-than-$1,000 category and top out with one asset valued at between $1 million and $5 million.
If Greenspan's assets are valued at the maximum level, they totaled $9.6 million at the end of 2000, up from a maximum $7 million at the end of 1999.
Even at the low end of the valuations on the disclosure form, Greenspan's statement showed that he managed fairly well to hold his own, with investments valued at $3.1 million at the end of the year, compared with a low-end valuation of $3.4 million in 1999.
The Dow Jones industrial average fell by 6.2 percent last year, its first loss in a decade, while the technology-heavy Nasdaq composite index lost 39.3 percent of its value, its worst annual loss in history.
Greenspan's investments are concentrated in Treasury securities, considered the world's safest investment since the U.S. government has never failed to pay investors who hold its bills, notes and bonds.
These holdings also allow Greenspan, often referred to as the most powerful economic policy-maker in the world, to avoid conflicts of interest that could arise if some companies fared better than others on the basis of his decisions on raising or lowering interest rates.
By investing in the safety of U.S. government securities, Greenspan also avoids the ups and downs of the stock market.
While Greenspan does not own stocks, his wife, NBC reporter Andrea Mitchell, does, according to the disclosure form, which requires a listing of a spouse's assets.
Mitchell owns stock in General Electric, the parent company of NBC, as well as Estee Lauder, Clorox, H.J. Heinz, Kimberly Clark, McDonald's and Rubbermaid, among others. Her biggest single holding, listed in the category of $250,001 to $500,000, was in Abbott Laboratories.
The disclosure form also shows that Mitchell earned $72,500 for giving five speeches last year to groups including Sweet Briar College to the Jewish Community Center of Richmond.
