As I noted in my Nobel lecture, an early insight in my work on the economics of information concerned the problem of appropriability - the difficulty that those who pay for information have in getting returns.

My teachers helped guide and motivate me; but the responsibility of learning was left with me, an approach to learning which was later reinforced by my experiences at Amherst.

We could, of course, always make the payments, simply by printing more money - we simply promise to pay people by giving them dollar bills - but that could set off inflation.

The budgetary cost to the UK of the wars in Iraq and Afghanistan through 2010 will total more than £18 billion. If we include the social costs the total impact will exceed £20 billion.

One of the real costs of the war is that our security is actually less than it otherwise would have been - ironic, since enhancing security was one of the reasons for going to war. Our armed forces have been depleted - we have been wearing out equipment and using up munitions faster than we have been replacing them; the armed forces face difficult problems in recruitment -by any objective measures,including those used by the armed forces, quality has deteriorated significantly.

The important lesson of the deficit is - and the national debt - is we have to be careful about how we're spending money.

Negative effects on the economy were covered up with a flood of liquidity from the Fed. That,plus lax regulation, led to a housing bubble, a consumption boom - but we were living on borrowed money. It was inevitable that there would be a day of reckoning, and it has now come. We will be paying the costs "with interest".