Greenspan: Price swings challenge policy-makers

Federal Reserve Chairman Alan Greenspan said today that policy-makers are being challenged by dramatic gains and losses in the stock market and less volatile movements in home prices.

The challenge, he said, is for policy-makers to try to better understand how gains or losses on stock investments and in home values affect consumers' willingness to spend.

Consumer spending accounts for two-thirds of all economic activity and has been a main force propping up the struggling economy. The yearlong economic slowdown has led to a slide in the stock market. But home values, for the most part, have gone up.

"There can be little doubt that sizable swings in the market values of business and household assets have created important challenges for policy-makers," Greenspan said in a speech delivered at the Fed's annual retreat in Wyoming's Grand Tetons.

To assess how gains or losses from different types of assets -- a stock versus a home -- affect consumer spending and thus the overall economy will require more analysis, Greenspan said.

"To answer these questions, we need far more information than we currently possess about the nature and the sources of capital gains and the interaction of these gains with credit markets and consumer behavior," he said.

Nauru OKs laws to clean up banking industry

YAREN, Nauru >> Bowing to pressure from the international community, the tiny Pacific nation of Nauru has passed a law aimed at preventing criminal gangs laundering money through its offshore banks.

The Pacific island republic's president, Rene Harris, said the legislation, passed earlier this week, ended "practices that have tarnished the name of Nauru in the international community for far too long."

Parliament held a special sitting Monday to enact an anti-money laundering bill to meet a September deadline set by the Organization for Economic Cooperation and Development, a Paris-based think tank for advanced nations.

Nauru, which the OECD listed with Russia and the Philippines as being one of the world's three major money laundering centers, had been warned that it would be hit with unspecified reprisals unless it cooperated with the OECD's fight against money laundering.

The nation will establish a regulatory body to supervise registered offshore banks operating in Nauru.

At least 3000 foreign banks were said to be registered in Nauru.

In other news ...

WASHINGTON >> The Justice Department urged the Supreme Court today to reject Microsoft's request for review of the antitrust case against the computer software giant.

The software manufacturer argues that the case is "ripe" for the high court's review, "but Microsoft offers no satisfactory explanation of why that is so," states the 26-page Justice Department filing.

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[TAKING NOTICE]

NEW JOBS

>> Select Staffing Services has named Judy Bishop general manager. She was most recently with Talent Tree Staffing Services in Houston.

>> Linda Hang has been named unit supervisor in the accounting department at First Insurance Company of Hawaii Ltd. She most recently served as a supervising senior tax specialist at KPMG LLP. Also, Mark A. Mizuo has been named supervisor in the information systems department at the company. He has been with First Insurance since 1995.

>> Keith Pope has been named director of golf at Waikoloa Beach Resort. With more than 18 years of golf management experience, he most recently served as director of golf at the Legacy Golf Club in Sarasota, the No. 1 course in southwest Florida, according to Florida Golf Week.

>> The Oahu Small Business Development Center has named Mark K. Tagawa business development specialist. He will be responsible for servicing SBDC clients in the Leeward, North Shore, Central and Waianae areas of Oahu. Tagawa previously owned his own business and has served in the U.S. Air Force.