Greenspan Says He Felt Odd About Moscow Talks

Alan Greenspan, chairman of the Federal Reserve Board, wound up two days of talks with leading Soviet economists Tuesday and said the talks made him feel a bit odd.

Greenspan, who had wide-ranging discussions about the Soviet and American economies with Finance Minister Valentin Pavlov and radical economist Gavril Popov, among others, said they steered away from analyzing the pluses and minuses of their respective systems.

Meeting with reporters at the U.S. ambassador’s residence, Greenspan said: “Did we get into ideological debates on values? The answer is no, we did not.”

Nevertheless, he said, “When I walked into a meeting for the first time there was a . . . certain awkwardness.

“It was an odd feeling for me, but if I didn’t feel odd, I must say, I’d be peculiar. Their forthcoming attitude and willingness to answer any question I put to them quickly dissipated that concern.”

Basic Aim of the Fed

Greenspan, who has been chairman of the Federal Reserve Board since August, 1987, was invited to Moscow by Leonid Abalkin, a deputy prime minister and senior economic adviser to Soviet President Mikhail S. Gorbachev.

In a speech in Moscow, Greenspan said Tuesday that the basic aim of the Federal Reserve is to fight inflation--not to promote short-term economic growth or realign currencies.

“Attempts to hold interest rates at unsustainably low levels have been shown to result in accelerating inflation,” Greenspan said. “Similarly, attempts to maintain unrealistic exchange rates may lead to destabilizing international capital flows and ultimately have to be abandoned.”

In New York, the stock and currency markets responded quickly to his remarks because they seemed to suggest that the Fed will not cut interest rates any time soon. The Dow Jones industrial index fell and the value of the dollar surged.

Soviet officials said before his arrival that Greenspan’s visit was intended to give him an opportunity to exchange views and offer advice--an astounding admission in a country where for years the leaders have expounded on the ills of capitalism.

Greenspan is not the first Fed chairman to visit the Soviet Union, but his trip comes at a time of growing public impatience here with the slow pace of Gorbachev’s economic reforms.

The Soviet economists, he said, “were really quite curious” about how the American market economy works and were “interested in determining whether any of our practices are applicable to the special problems confronting Soviet economic policy-makers.”

And were they?

“I don’t mind telling you what I told them,” he said. “But I don’t want to tell you what they told me.”

Asked what advice he had offered, he said, “It would be presumptuous of me to try to suggest how they should alter their system.”

‘The Same Direction’

Greenspan’s visit included meetings with his direct counterpart, Victor Gerashchenko, chairman of the Soviet Union’s state bank; Vyacheslav Senchagov, chairman of the state committee that sets prices, and progressive economist Oleg Bogomolov.

Among the Soviet economists, he said, “there were differences, as indeed there should be,” adding: “But there was a sense that they were all going in the same direction. . . . All very generally would characterize the nature of the problems in much the same way.”

Greenspan said he and the Soviet economists discussed everything from how Moscow could reduce its ruble surplus and make the currency convertible on the world market to how to close the country’s budget gap.