It is better to have a cat and mouse game where the cat has the upper hand than a cat and mouse game where the mice are ruling. Because the latter means that the market participants are given free range. That was actually the big misconception of our national hero Ronald Reagan, who always talked about the magic of the market.

When money is free, the rational lender will keep on lending until there is no one else to lend to.

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

China could easily emerge as the great winner if the Chinese leaders handle the situation well. On the other hand, they could also turn out to be the biggest losers if they handle it poorly. If the management turns out be wrong, this could lead to a political crisis in China.

The lower interest rates fueled housing and consumption booms in countries such as Spain and Ireland. At the same time, Germany, struggling with the burdens of reunification, tightened its belt and became more competitive. All this led to a wide divergence in economic performance. Europe became divided into creditor and debtor countries.

The ultimate asset bubble is gold.

An open society calls itself open to improvement. It is based on the recognition that people have divergent views and interests, and that nobody is in possession of the ultimate truth.