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Alan Greenspan once said that we had virtually eliminated systemic risk. A few years later, we were confronted with system wide financial losses. Why did
Alan Greenspan once said that we had virtually eliminated systemic risk. A few years later, we were confronted with system wide financial losses. Why did Greenspan's assertion lack validity? Select one: a. Greenspan failed to consider the degree to which bank stocks were correlated with each other. b. Greenspan was correct with the exception that the SEC lacked the proper tools for regulatory enforcement c. Greenspan's assertion lacked validity because all risk cannot be eliminated from investing. Systemic risk cannot be eliminated from investing through diversification d. With the proper degree of diversification, Greenspan is correct. The losses come from a lack of diversification by the investment banking community O e. None of the above answers provide the reason why Greenspan's assertion lacked validity
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