Greenspan Sees A ‘Probability' Of Recession

Former Federal Reserve Chairman Alan Greenspan said there's a "one-third probability" of an American recession this year and the current expansion won't have the staying power of its decade-long predecessor.

"We are in the sixth year of a recovery; imbalances can emerge as a result," Mr. Greenspan, 81, said in an interview Monday at his office in downtown Washington. "Tenyear recoveries have been part of a much broader global phenomenon. The historically normal business cycle is much shorter" and is likely to be this time, he added.

Mr. Greenspan's outlook contrasts with the prediction of his successor Ben S. Bernanke, who told Congress last week that the economy may strengthen this year. Mr. Bernanke's upbeat assessment helped steady stock markets on February 28 after a plunge the day before.

"It is possible that we can have a recession at the end of this year," said Mr. Greenspan. Mr. Bernanke, 53, declined to comment.