The art of banking is always to balance the risk of a run with the reward of a profit. The tantalizing factor in the equation is that riskier borrowers pay higher interest rates. Ultimate safety - a strongbox full of currency - would avail the banker nothing. Maximum risk - a portfolio of loans to prospective bankrupts at usurious interest rates - would invite disaster. A good banker safely and profitably treads the middle ground.

[C]apitalism without financial failure is not capitalism at all, but a kind of socialism for the rich.

Central banks have gotten out of the central banking business and into the central planning business, meaning that they are devoted to raising up-if they can-economic growth and employment through the dubious means of suppressing interest rates and printing money. The nice thing about gold is that you can't print it.

In almost every walk of life, people buy more at lower prices; in the stock market they seem to buy more at higher prices.

Progress is cumulative in science and engineering, but cyclical in finance.

I believe that there is an important kernel of truth in the idea that financial errors recur every other generation.

The Fed can change how things look, not how things are