Greenspan: Wall Street to Blame for Economy

Monday, March 17, 2008 10:43 a.m. EDT

Former Federal Reserve Chief Alan Greenspan squarely blamed Wall Street this week for irrational decision-making that has pushed the U.S. economy to the brink.

The economy, riding now on the edge of what is likely to be a serious contraction, can and will right itself -- once home prices revert to pre-bubble levels, Greenspan wrote in the Financial Times this week.

Greenspan figures there are 800,000 too many homes on the market, only about half of which will be absorbed by normal population growth during 2008.

"The level of home prices will probably stabilize as soon as the rate of inventory liquidation reaches its maximum, well before the ultimate elimination of inventory excess. That point, however, is still an indeterminate number of months in the future,â€