Greenspan -- 2 (Fed considering adjustments to loss of Treasury debt)

Greenspan said the Fed will also have to adjust to the loss of Treasury debt. He said the Federal Open Market Committee has asked staff to explore short-run alternatives such as the purchase of Ginnie Mae securities and to broaden the types of collateral allowed for repo transactions.Over the longer term, the Fed may have to transform the use of the discount window or ask Congress to change the law governing what assets the Fed is currently allowed to buy for its portfolio."Of course, what adjustments we make to our procedures -- and when we make them -- depend on how rapidly the supply of Treasury securities dwindles and on how long the Treasury market is not available," Greenspan said."The Federal Reserve will be seeking active consultations and discussions with you and other market participants, as well as with the Congress, before significant changes are made to Federal Reserve procedures and methods," he told the Bond Market Association.

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