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, ... This is the reason that history has not dealt kindly with the aftermath of protracted periods of low risk premiums.

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.

Improvements in lending practices driven by information technology have enabled lenders to reach out to households with previously unrecognized borrowing capacities.

Excessive optimism sows the seeds of its own reversal.

I'm a plain soap kind of guy.

By far the most significant event in finance during the past decade has been the extraordinary development and expansion of financial derivatives.

When trust is lost, a nation's ability to transact business is palpably undermined.