Markets can influence the events that they anticipate.

Hedge funds are a very efficient way of managing money. But there are clearly some risks. Hedge funds use credit and credit is a source of instability. Transactions involving credit should be regulated.

We are trying to make the world a better place, but that is not necessarily what we accomplish. Many of the problems which preoccupy us are basically insoluble.

Stock market bubbles don't grow out of thin air. They have a solid basis in reality, but reality as distorted by a misconception.

The global crisis is caused by pathologies inherent in the global financial system itself.

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.

My conceptual framework, which basically emphasizes the importance of misconceptions, makes me extremely critical of my own decisions. I know that I am bound to be wrong, and therefore am more likely to correct my own mistakes.