Once we realize that imperfect understanding is the human condition there is no shame in being wrong, only in failing to correct our mistakes.

However, you have to recognize that regulations will never be completely successful and they will always be full of holes. You must constantly be ready to fill new holes. Actually regulation should be kept to a minimum, but there has to be some cooperation between market participants and authorities - as was the case in the early postwar years. The Bank of England was a very successful regulator by cooperating with market participants. This cooperative spirit was broken by the market fundamentalists.

If I had to sum up my practical skills, I would use one word: survival. And operating a hedge fund utilized my training in survival to the fullest.

Markets can influence the events that they anticipate.

The hardest thing to judge is what level of risk is safe.

There is no question that a breakup of the euro would be very damaging, very costly, both financially and politically. And the biggest loss would be incurred by Germany. Germans have to bear in mind that, effectively, they have suffered practically no losses so far. Transfers have all been in the form of loans, and it is only when the loans are not repaid that real losses will be incurred.

When it comes to social consequences, they've got all different people acting in different ways, very difficult to even have a proper criterion of success. So, it's a difficult task.