How do we know when irrational exuberance has unduly escalated asset values?
ALAN GREENSPANI’ve been in and out of Wall Street since 1949, and I’ve never seen the type of animosity between government and Wall Street. And I’m not sure where it comes from, but I suspect it’s got to do with a general schism in this society which is really becoming ever more destructive.
More Alan Greenspan Quotes
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I do not deny that many appear to have succeeded in a material way by cutting corners and by manipulating associates, both in their professional and in their personal lives.
ALAN GREENSPAN -
We need, in effect, to make the phantom ‘lock-boxes’ around the trust fund real.
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This decade is strewn with examples of bright people who thought they built a better mousetrap that could consistently extract abnormal returns from the financial markets.
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Any onset of increased investor caution elevates risk premiums and, as a consequence, lowers asset values and promotes the liquidation of the debt that supported higher asset prices.
ALAN GREENSPAN -
In an economy that already has lost some momentum, one must remain alert to the possibility that greater caution and weakening asset values in financial markets could signal or precipitate an excessive softening in household and business spending.
ALAN GREENSPAN -
Corruption, embezzlement, fraud, these are all characteristics which exist everywhere.
ALAN GREENSPAN -
Recent episodes in which Fed officials hinted at a shift toward higher interest rates have unleashed significant volatility in markets.
ALAN GREENSPAN -
The economy is turning, and credit comes in with a lag, .. To the extent that a number of small firms are finding it difficult to get the credit they need at a price they can afford, that’s likely to change for the better.
ALAN GREENSPAN -
Indeed, better risk management may be the only truly necessary element of success in banking.
ALAN GREENSPAN -
I have found no greater satisfaction than achieving success through honest dealing and strict adherence to the view that, for you to gain, those you deal with should gain as well.
ALAN GREENSPAN -
In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value.
ALAN GREENSPAN -
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 -
At the risk of some oversimplification, if the skill composition of our work force meshed fully with the needs of our increasingly complex capital-stock, wage-skill differentials would be stable.
ALAN GREENSPAN -
I’ve always argued that this country has benefited immensely from the fact that we draw people from all over the world.
ALAN GREENSPAN -
Skilled shortages in America exist because we are shielding our skilled labor force from world competition. [Visa quotas] have been substituted for the wage pricing mechanism.
ALAN GREENSPAN