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History has not dealt kindly with the aftermath of protracted periods of low risk premiums.

Alan Greenspan

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Alan Greenspan
Age: 98
Born: 1926
Born: March 6
Banker
Economist
Entrepreneur
Jazz Musician
Politician
New York City
New York
Kindly
Dealt
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Periods
Risk
Economy
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History
Protracted
Aftermath

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All taxes are a drag on economic growth. It's only a question of degree.
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We cannot rule out a situation in which a preemptive policy tightening becomes necessary, ... Such caution seems especially warranted with regard to the sharp rise in equity prices during the past two years. These gains have obviously raised questions of sustainability.
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If we allow terrorism to undermine our freedom of action, we could reverse at least part of the palpable gains achieved by postwar globalization. It is incumbent upon us not to allow that to happen.
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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.
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The recent evidence increasingly suggests that an economic expansion is already well under way, although an array of influences unique to this business cycle seems likely to moderate its speed.
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It seems superfluous to constrain trading in some of the newer derivatives and other innovative financial contracts of the past decade. The worst have failed investors no longer fund them and are not likely to in the future.
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History cannot be reduced to a set of statistics and probabilities.
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Fear and euphoria are dominant forces, and fear is many multiples the size of euphoria. Bubbles go up very slowly as euphoria builds. Then fear hits, and it comes down very sharply. When I started to look at that, I was sort of intellectually shocked. Contagion is the critical phenomenon which causes the thing to fall apart.
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The need for values is inbred. Their content is not.
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Well, you probably will always believe there should be laws against fraud, and I don't think there is any need for a law against fraud.
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We may be in a rapidly evolving international financial system with all the bells and whistles of the so-called new economy. But the old-economy rules of prudence are as formidable as ever. We violate them at our own peril.
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The only sustainable way to increase demand for vacant houses is to spur the formation of new households. Admitting more skilled immigrants, who tend to earn enough to buy homes, would accomplish that while paying other dividends to the U.S. economy.
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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?
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I was a fairly good amateur musician, and I was an average professional. But the one thing I saw was that the big band business was fading.
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Amateurs want to be right. Professionals want to make money.
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I'm a better economist than I was a sax player.
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Excessive optimism sows the seeds of its own reversal.
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I believe that the general growth in large [financial] institutions have occurred in the context of an underlying structure of markets in which many of the larger risks are dramatically -- I should say, fully -- hedged.
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I guess I should warn you, if I turn out to be particularly clear, you've probably misunderstood what I've said.
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