In general, markets know more than the people who write about them.

The 1980s are to debt what the 1960s were to sex. The 1960s left a hangover. So will the 1980s.

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.

To suppose that the value of a common stock is determined purely by a corporation's earnings discounted by the relevant interest rates and adjusted for the marginal tax rate is to forget that people have burned witches, gone to war on a whim, risen to the defense of Joseph Stalin and believed Orson Welles when he told them over the radio that the Martians had landed.

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

It is an axiom nowadays that no bank fails for lack of capital; unprofitable lending is always the underlying cause.

In general, markets know more than the people who write about them.