Paul McCulley

Quotes

• "We believe that Mr. Greenspan should quit giving away puts on the equity market."
• "Thus, we are willing to say stocks are irrationally exuberant, notably growth stocks, and, in particular, technology stocks."
• "There is room for the Fed to create a bubble in housing prices, if necessary, to sustain American hedonism. And I think the Fed has the will to do so, even though political correctness would demand that Mr. Greenspan deny any such thing."
• "Debt deflation is a beast of burden that capitalism cannot bear alone."
• "Macroeconomic life after bubbles is not a self-correcting process of renewal, but a self-feeding process of debt deflation — to wit, it’s a Minsky Moment."
• "Loosely defined, a Shadow Bank is a levered-up financial intermediary whose liabilities are broadly perceived as of similar money-goodness and liquidity as conventional bank deposits. These liabilities could be shares of money market mutual funds; or the commercial paper of Finance Companies, Conduits and Structured Investment Vehicles; or the repo borrowings of stand-alone Investment Banks and Hedge Funds; or the senior tranches of Collateralized Debt Obligations; or a host of other similar funding instruments."

  Footnotes