Former Federal Reserve Chairman Greenspan said he was "shocked" by
the breakdown in the credit system and told Congress the crisis was once in a
century.

Greenspan was hailed as one of the most accomplished central bankers in
U.S. history when he retired in January 2006. However, his decision to keep
interest rates low during his final years at the Fed have been blamed in part
for the housing bubble and crash that has led to the current deep financial
crisis.

Former Federal Reserve Chairman Alan Greenspan told Congress that the
current financial crisis was a very rare event and said that he is
"shocked" at the breakdown in U.S. credit markets.

Greenspan appeared before the House Committee on Oversight and Reform.

Former Federal Reserve Chairman Alan Greenspan, saying:
"We are in the midst of a once-in-a century credit tsunami."


Greenspan said that while he had concerns in 2005 that risk was being
understated he was surprised about the current crisis.

Former Federal Reserve Chairman Alan Greenspan, saying:
"This crisis, however, has turned out to be much broader than
anything I could have imagined."

He also said that behavior by financial institutions took him by
surprise.

Former Federal Reserve Chairman Alan Greenspan, saying
"Those of us who have looked to the self-interest of lending
institutions to protect shareholder's equity (myself especially) are in a
state of shocked disbelief."

Looking ahead, Greenspan says he expects to more layoffs and a rise in
unemployment.

Former Federal Reserve Chairman Alan Greenspan, saying:
"Given the financial damage to date, I cannot see how we can avoid
a significant rise in layoffs and unemployment.

Greenspan was hailed as one of the most accomplished central bankers in
U.S. history when he retired in January 2006. However, his decision to keep
interest rates low during his final years at the Fed have been blamed in part
for the housing bubble and crash that has led to the current deep financial
crisis.

Deborah Lutterbeck, Reuters.