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Yellen Faces Greenspan Oasis Warning as She Weighs Rate Rise

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How Much Does Janet Yellen Care About the Selloff?

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Former Federal Reserve Chairman Alan Greenspan warned in 1998 that the U.S. could not remain an oasis of prosperity in a world beset by financial turbulence. Now Janet Yellen must decide whether that counsel still holds true.

A rout in emerging markets led by China has triggered an equities sell-off in the U.S., with the Dow Jones Industrial Average dropping by more than 1,000 points in early trading before paring the decline to 588 points, or 3.6 percent, as of 4:15 p.m. in New York. The turbulence has investors questioning whether the durable U.S. economy can withstand weakness abroad and wondering what that means for the timing of the Fed’s interest-rate liftoff.