No matter how skillful the trading scheme, over the long haul, abnormal returns are sustained only through abnormal exposure to risk.

Clearly, sustained low inflation implies less uncertainty about the future, and lower risk premiums imply higher prices of stocks and other earning assets. We can see that in the inverse relationship exhibited by price/earnings ratios and the rate of inflation in the past. 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?

Senator, we are groping for understanding, the knowledge you assume I possess doesn't exist' - 'The only effective regulation lies in the propensity of customers to choose alternatives, of investors to move their funds elsewhere and of labour to acquire technical skills' - 'Senator, if I seem clear to you, you must have misunderstood me' - 'Unfortunately, Senator, nobody knows where the next innovative idea is coming from. Political decisions are never random and will always lose out to innovative alternatives

I'm not denying that monopolies are terrible things, but I am denying that it is readily easy to resolve them through legislation of that nature.

Cash is available and we should use that in larger amounts, as is necessary, to solve the problems of the stress of this.

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

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