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Greenspan says US on edge of recession

Former Federal Reserve chairman Alan Greenspan said the US economy is on the verge of its first recession in six years as falling home values hurt consumer spending.

"We are clearly on the edge," Greenspan told a group of energy-industry executives yesterday at the Cambridge Energy Research Associates' 27th annual CERAWeek conference in Houston, Texas.

He reiterated comments from last month that the odds of an economic contraction are "50 percent or better."

Greenspan's view has evolved from a year ago, when he saw a one-in-three chance of a recession, citing slowing profit growth and becoming one of the first economists to warn of the risk. Now, Wall Street firms including Merrill Lynch & Co and Goldman Sachs Group Inc are forecasting a contraction in the aftermath of the worst housing downturn in a quarter century.
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