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The more flexible an economy, the greater its ability to self-correct in response to inevitable, often unanticipated, disturbances and thus to contain the size and consequences of cyclical imbalances.

Alan Greenspan

I came to a stark realization: chronic surpluses could be almost as destabilizing as chronic deficits.
ALAN GREENSPAN

Almost Came Deficit Destabilize Chronic Realization Stark Surplus
Cash is available and we should use that in larger amounts, as is necessary, to solve the problems of the stress of this.
ALAN GREENSPAN

Amount Available Cash Necessary Problem Should Solve Stress
Gold, unlike all other commodities, is a currency…and the major thrust in the demand for gold is not for jewelry.
ALAN GREENSPAN

Commodity Currency Demand God Gold Jewelry Thrust Unlike
Gold still represents the ultimate form of payment in the world.
ALAN GREENSPAN

Gold Payment Represent Ultimate World
Fear and euphoria are dominant forces, and fear is many multiples the size of euphoria. Bubbles go up very slowly as euphoria builds.
ALAN GREENSPAN

Dominant Euphoria Fear Force Many Multiply Size
If I say something which you understand fully in this regard, I probably made a mistake.
ALAN GREENSPAN

Made Mistake Probably Regard Something Understand
But how do we know when irrational exuberance has unduly escalated asset values, which then become subject to unexpected and prolonged contractions as they have in Japan over the past decade?
ALAN GREENSPAN

Country Decade Escalate Irrational Past Subject
There’s an interesting question here because if the gold price broke in that context, the thermometer would not be just a measuring tool. It would basically affect the underlying psychology.
ALAN GREENSPAN

Context Mean Price Psychology Thermometer Underlying
Excessive optimism shows the seeds of its own reversal in the form of imbalances that tend to grow over time.
ALAN GREENSPAN

Excessive Grow Over Own Reversal Seed Show Time
If you get beyond the political rhetoric [and assembled a group to solve Social Security] it would take them 15 minutes. It would take them 15 minutes only because 10 minutes was used for pleasantries.
ALAN GREENSPAN

Group Minute Pleasantries Political Rhetoric Security Solve
I must say, I never expected to see the day where I would be talking about anything other than reducing the debt, I’m running into the tyranny of zero, which is where you can’t reduce (the debt) any more
ALAN GREENSPAN

Anything Day Expect Must Reduce Say Talk
Nor can private counterparties restrict supplies of gold, another commodity whose derivatives are often traded over-the-counter, where central banks stand ready to lease gold in increasing quantities should the price rise.
ALAN GREENSPAN

Another Commodity Counterparty Derivative Gold Often Private Restrict Supply Trade
The more flexible an economy, the greater its ability to self-correct in response to inevitable, often unanticipated, disturbances and thus to contain the size and consequences of cyclical imbalances.
ALAN GREENSPAN

Ability Correct Economy Flexible Greater Inevitable More Response Self Unanticipated
Recent episodes in which Fed officials hinted at a shift toward higher interest rates have unleashed significant volatility in markets.
ALAN GREENSPAN

Episode Higher Interest Market Official Rate Recent Toward Unleash Volatility
We will have more crises and none of them will look like this because no two crises have anything in common except human nature.
ALAN GREENSPAN

Anything Common Crise Human Like Look Nature
History demonstrates that participants in financial markets are susceptible to waves of optimism.
ALAN GREENSPAN

Demonstrate Excessive Financial History Optimism Particular Wave

The more flexible an economy, the greater its ability to self-correct in response to inevitable, often unanticipated, disturbances and thus to contain the size and consequences of cyclical imbalances.

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The more flexible an economy, the greater its ability to self-correct in response to inevitable, often unanticipated, disturbances and thus to contain the size and consequences of cyclical imbalances.

Related Topics

Popular Authors

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