Alan Greenspan Quotes

One day we will have more inflation, and our bonds will bleed like a pig. The only reason for buying long bonds is short-term or as a desperate haven for terrorized investors. But the potential to make longer-term real money is naught.

Markets don't like instability, investors shy away from uncertainty, and consumer confidence goes down in difficult times.

There is no risk-free path for monetary policy.

Typically in a panic, corporate bonds sell off as investors fear weaker growth, tighter financial conditions, or need liquidity.

The markets don't like instability and they don't like uncertainty.

Many of us like to think of financial economics as a science, but complex events like the financial crisis suggest that this conceit may be more wishful thinking than reality.

The very nature of finance is that it cannot be profitable unless it is significantly leveraged... and as long as there is debt, there can be failure and contagion.

So you know, everyone points out Greece's default record, but the history of a lot of sovereign nations is not a good one when it comes to lending them money.

Defaulting on the nation's debt would be cataclysmic. The U.S. Treasury's Aaa rating is the one constant in the world's financial system. When times are bad anywhere on the planet, global investors flock to Treasury bonds because they know they will get their money back.

In a crisis, markets always look to see who is the next-worst off and proactively begin shying away from them.

I want to see an end to sovereign risk questions over Australia.

Investors don't like uncertainty.

The global financial crisis - missed by most analysts - shows that most forecasters are poor at pricing in economic/financial risks, let alone geopolitical ones.

Investors should be cautiously positioned as the global economy and markets face major uncertainties. The downgrade will be a further headwind to growth and job creation in the U.S.

And so it can be very much in the interest of bank A to sell-short bank B shares, or buy CDSes on bank B, because they have exposure to bank B. It's the responsible thing to do as a fiduciary, and yet if everyone does it at the same time, it's destabilizing because everyone is selling.

Banks are employing risky derivatives strategies to goose up returns….the interbank market could freeze up, and one could well have a full blown financial crisis.

If investors avoid the Treasury market, we could be unable to pay off maturing securities, which would mean an immediate default. Market participants generally agree that even a brief default would create potentially catastrophic risks to the financial system, like the meltdown of 2008.

Starting in the wake of the 2008 GFC (Global Financial Crisis), market observers have warned of a crash in the bond market. Initially, it was believed that the trillions printed to bail out the banks would cause inflation and, therefore, a flight from bonds.

Bonds despite their ridiculous yields will not easily be threatened with a new bear market.

Risk managers and investment bankers and actually, all kinds of investors took on more risk than they expected. So there was a failure of risk management. There was a failure to recognize how much risk there was in some of these securities that people bought.

If we leave the European Union it's a risk to our economy - it's a risk to pensioners, it's a risk to homeowners, it's a risk to people in work.

What is very negative is that in every country in Europe, the largest owner of that country's sovereign bonds are that country's banks.

If a division becomes insolvent, the credit markets' reaction to that is immediate - regardless of what period of time you think you have to remedy.

I think that it would be a mistake for any institution to think that their stake in a default or in a voluntary accord is determined by the amount of their exposure, hedged or unhedged.

When you're levered 9 to 1, it'd be unreal for a bank to go down.