Newsweek has picked out some killer quotes that they thought tracked the financial crisis. Here are a few of them, with my own interpretation ...
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February 23rd 2004
“American consumers might benefit if lenders provided greater mortgage product alternatives to the traditional fixed rate mortgage. To the degree that households are driven by fears of payment shocks but are willing to manage their own interest rate risks, the traditional fixed-rate mortgage may be an expensive method of financing a home.”
Alan Greenspan at a Credit Union Conference in Washington
The Finanser’s view: “Get out there and sell cheapo mortgages to those poor folks who can’t afford them.”
September 17th ~2004
“It has the potential to be an epidemic. We think we can prevent a problem that could have as much impact as the S&L crisis.”
Assistant FBI Director Chris Swecker on the sharp increase in US mortgage fraud
The Finanser’s view: “Access to cheap money has made the criminals work out how to get it.”
February 2005
“I believe that in years to come, historians will see the beginning of the 21st century as the ‘golden age’ of real estate.”
National Association of Realtors’ Chief Economist David Lereah, in his book Are You Missing the Real Estate Boom?
The Finanser’s view:“I am Spartacus.”
February 20th 2005
“... the economy is weaker than it appears. Using GDP growth and unemployment, the US economy is healthy. But the level of debt (both consumer and government), the real estate boom that seems based on leverage and loose credit ... and the poor employment situation (especially the low level of participation) indicate an unhealthy economy. I believe this recovery is being built on a marshland of debt.”
The Calculated Risk Blog
The Finanser’s view:“I am Nostradamus.”
October 24th 2006
“Despite sluggish growth, largely due to declining residential investment and auto production in the second half of this year, we are optimistic about a rebound in 2007.”
Doug Duncan, the Mortgage Bankers Association’s Chief Economist
The Finanser’s view:“Dude, this reefer is way strong.”
March 28th 2007
“[The impact of] problems in the subprime market seems likely to be contained.”
Federal Reserve Chairman Ben Bernanke in congressional testimony on Capitol Hill
The Finanser’s view: “Life is like a box of chocolates. You just never know which one you’re gonna get.”
August 26th 2007
“... capitalism without financial failure is not capitalism at all, but a kind of socialism for the rich.”
James Grant of Grant’s Interest rate Observer, referring to banks’ responsibility for the subprime crisis in a New York Times editorial
The Finanser’s view:“Who’s too big to fail?”
February 14th 2008
“At present, my baseline outlook involves a period of sluggish growth, followed by a somewhat stronger pace of growth starting later this year ...”
Federal Reserve Chairman Ben Bernanke in congressional testimony on Capitol Hill
The Finanser’s view:“Who ate my chocolates?”
May 7th 2008
“I do believe that the worst is likely to be behind us.”
Treasury Secretary Henry Paulson in a Wall Street Journal interview
The Finanser’s view:“I’m forever blowing bubbles.”
September 15th 2008
“I’ve been on Wall Street for many years and I’ve never seen a weekend like this one. We are unwinding what has been years of silliness in the financial markets, and the silliness is being vaporised as we speak, unfortunately with the stock price of a number of companies involved in it.”
Michael Holland, Chairman and Founder of Holland & Co, in an interview with Bloomberg
The Finanser’s view:“Wall Street R.I.P.”
September 25th 2008
“If money isn’t loosened up, this sucker could go down.”
President George W. Bush
The Finanser’s view:“Wall Street R.I.P.”
September 14th 2009
“I want everybody here to hear my words. We will not go back to the days of reckless behaviour and unchecked excess at the heart of this crisis, where too many were motivated only by the appetite for quick kills and bloated bonuses. Thos on Wall Street cannot resume taking risks without regard for consequences and expect that next time, American taxpayers will be there to break their fall.”
President Barack Obama
The Finanser’s view:“Wall Street R.I.P.”
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Chris M Skinner
Chris Skinner is best known as an independent commentator on the financial markets through his blog, TheFinanser.com, as author of the bestselling book Digital Bank, and Chair of the European networking forum the Financial Services Club. He has been voted one of the most influential people in banking by The Financial Brand (as well as one of the best blogs), a FinTech Titan (Next Bank), one of the Fintech Leaders you need to follow (City AM, Deluxe and Jax Finance), as well as one of the Top 40 most influential people in financial technology by the Wall Street Journal's Financial News. To learn more click here...