Alan Greenspan Asset Quotations

How do we know when irrational exuberance has unduly escalated asset values, which then become subject to unexpected and prolonged contractions as they have in Japan over the past decade?

Because it is difficult to suppress growing market exuberance when the economic environment is perceived as more stable, a highly flexible system needs to be in place to rebalance an economy in which psychology and asset prices could change rapidly,

These changes, assisted by improved prices in asset markets, have left households and businesses better positioned than they were earlier to boost outlays as their wariness about the economic environment abates,

Before the crisis broke, there was little reason to question the three decades of phenomenally solid East Asian economic growth, largely financed through the banking system, so long as the rapidly expanding economies and bank credit kept the ratio of non-performing loans to total bank assets low,

But, given our current state of knowledge, I find it difficult to envision central banks successfully targeting asset prices any time soon,

How do we know when irrational exuberance has unduly escalated asset values?

...In an economy that already has lost some momentum, one must remain alert to the possibility that greater caution and weakening asset values in financial markets could signal or precipitate an excessive softening in household and business spending,

investing Social Security trust fund assets in equities compromises the efficient allocation of our capital -- which?is so essential to raising our standards of living.

Investing a portion of the Social Security trust fund assets in equities as the administration and others have proposed would arguably put at risk the efficiency of our capital markets and, thus, our economy,

As the value of assets and liabilities have risen relative to income, we have been confronted with the potential for our economies to exhibit larger and perhaps more abrupt responses to changes in factors affecting the balance sheets of households and businesses,

This situation suggests that international investors will eventually adjust their accumulation of dollar assets or, alternatively, seek higher dollar returns to offset concentration risk, elevating the cost of financing of the U.S. current account deficit and rendering it increasingly less tenable,

The physical assets of such a firm comprise a small proportion of its asset base, ... Trust and reputation can vanish overnight. A factory cannot.

What is not clear is whether the market values that are being placed on particular assets involved in this technology revolution are appropriately priced.

The determination of global economic activity in recent years has been influenced importantly by capital gains on various types of assets, and the liabilities that finance them. Our forecasts and hence policy are becoming increasingly driven by asset price changes.

The Fed is struggling to find a firmer standard of monetary policy, ... The focus on asset prices has become an increasing issue of debate at the Fed.