Although the U.S. economy has gone through a period of considerable strain, an economic expansion is "already well under way," Federal Reserve Board Chairman Alan Greenspan told the U.S. Senate Committee on Banking, Housing and Urban Affairs on March 7.
"Despite the disruptions engendered by the terrorist attacks of Sept. 11, the typical dynamics of the business cycle have reemerged and are prompting a firming in economic activity," Greenspan said in his semiannual monetary policy report.
The report continuously discusses firmer activity in household spending, homebuilding, sales of existing homes and a rise in consumer spending from the sales of new motor vehicles. He attributed the rise in spending to the support of disposable income provided by a decline in prices of natural gas, fuel oil and gasoline and developments in the labor market.
To read Greenspan's comments, go to http://www.federalreserve.gov/boarddocs/hh/2002/march/testimony.htm.