After Greenspan caused widespread annoyance among Fed watchers for failing to address the issue a week ago at a high-level Fed symposium in Wyoming, he finally chose an academic conference at the University of California, Berkeley on Friday to deliver his eagerly awaited message. Greenspanthen headed to nearby San Francisco to join a meeting between US treasury secretary Robert Rubin and Japan's finance minister Kiichi Miyazawa on the question of what Japan should do to restore its economy and help its battered Asian neighbors recover from a deep slump. Although he did not directly comment on the bank's interest rate policy, Greenspan said this was a time for caution.

``It is just not credible that the United States can remain an oasis of prosperity unaffected by a world that is experiencing greatly increased stress,'' he warned. Greenspan suggested the central bank currently viewed the risks to the US economy as balanced -- confirming market speculation that the Fed has dropped its inclination, or "bias," to raise rather than cut rates or leave them unchanged -- but said it would have to consider carefully developments in the world economy in coming weeks and months. US market interest rates are hovering near historic lows as the crisis that once started as a purely regional upheaval inAsia has gathered speed, causing investors to seek shelter in US government paper. But the Fed has kept official interest rates steady ever since March 1997, afraid that strong demand at home may cause inflation to rise. The Fed's rate setting council next meets to debate the future course of monetary policy on September 29.