Economic Bubbles Quotes

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

In the economy of the cuckoo people that populate central banks, everything is possible. What you have is gigantic bubbles, the NASDAQ in 2000, then the housing bubble and then commodities in 2008 when oil went from $78 to $147 before plunging to $32 within six months.

You can go back to tulip bulbs in Holland 400 years ago. The human beings going through combinations of fear and greed and all of that sort of thing, their behavior can lead to bubbles. And it may have had and Internet bubble at one time, you've had a farm bubble, farmland bubble in the Midwest which resulted in all kinds of tragedy in the early '80s.

It's not that we can predict bubbles - if we could, we would be rich. But we can certainly have a bubble warning system.

People at the top spend less money than those at the bottom so when you have redistribution toward the top, aggregate demand goes down. Unless you intervene, you're going to have a weak economy unless something else happens. That something else could be a bubble. The United States tried a tech bubble and a housing bubble, but those were not sustainable answers. So I view inequality as a fundamental part of our macroeconomic weakness.

In 1985, the top five percent of the households - the wealthiest five percent - had net worth of $8 trillion - which is a lot. Today, after serial bubble after serial bubble, the top five per cent have net worth of $40 trillion. The top five percent have gained more wealth than the whole human race had created prior to 1980.

What we need to understand is, one, that there are market failures; and two, that there are things like asset bubbles and irrational exuberance. There are periods of booms, bubbles, and manias. These things, if left to themselves, can lead to crashes, to busts, to panics.

Market timing doesn't work. If all the bubbles and all this mispricing really exist, how come so few people see it before it turns out that way?

Next time, please pay a fair price for the services you depend on. Those have a better chance of surviving the bubbles.

We've suffered a 'Ponzification' of the economy in recent years, as bubbles have built up and then burst, and each time we act as though it's the first time.

The reason I am so negative about the Federal Reserve's policies is that they only target core inflation and argue that they can't identify bubbles, but when each bubble bursts, they flood the system with liquidity that brings about unintended consequences.

Bubbles are created when something positive is happening. People get over-enthusiastic about it and take the tide higher than it should go. The reality is bubbles are required to create an industry.

A snarky but accurate description of monetary policy over the past five years is that the Federal Reserve successfully replaced the technology bubble with a housing bubble

Solyndra's failure isn't a reason for the government to give up on alternative energy, any more than the failure of Pets.com during the Internet bubble means that venture capital should steer clear of tech projects.

When wealth concentrates at the very top, it can inflate unstable bubbles that threaten the economy.

Bubbles are always new; you just can't find an old bubble.

Reasonable men are not reasonable when you're in the bubbles which have characterized capitalism since the beginning of time.

Bubbles have quite a few things in common, but housing bubbles have a spectacular thing in common, and that is every one of them is considered unique and different.

If you get a flow of credit increasing, as we've seen in the last few years - that flow of credit didn't go to more wealth accumulation as we normally use the term in economics, as capital goods. What you got is an increase in bubbles of one kind or another.

The big money in booms is always made first by the public - on paper. And it remains on paper.

Investment bubbles and high animal spirits do not materialize out of thin air. They need extremely favorable economic fundamentals together with free and easy, cheap credit, and they need it for at least two or three years. Importantly, they also need serial pleasant surprises in such critical variables as global GNP growth.