A Quote by George Soros
I put forward a pretty general theory that financial markets are intrinsically unstable. That we really have a false picture when we think about markets tending towards equilibrium.
Related Quotes
The generally accepted theory is that financial markets tend towards equilibrium, and...discount the future correctly. I operate using a different theory, according to which financial markets cannot possibly discount the future correctly because the do not merely discount the future; they help to shape it.
Ultimately savings have to go somewhere and I think they will find their home in financial markets and within financial markets, a large part in equity.
I had always been interested in markets - specifically, the theory that in financial markets, goods will trade at a fair value only when everyone has access to the same information.
I’ve since come to understand that the universe operates on the same general equilibrium theory as markets.It never gives you something without making you pay for it somehow.
I did get introduced to the financial markets while I was in college. And I think I learned also how to sort of filter out all of the nonrational, or nonsensible, noise and sort of concentrate on what matters, and that's really what markets are about.
In certain circumstances, financial markets can affect the so-called fundamentals which they are supposed to reflect. When that happens, markets enter into a state of dynamic disequilibrium and behave quite differently from what would be considered normal by the theory of efficient markets. Such boom/bust sequences do not arise very often, but when they do, they can be very disruptive, exactly because they affect the fundamentals of the economy.
Financial markets are supposed to swing like a pendulum: They may fluctuate wildly in response to exogenous shocks, but eventually they are supposed to come to rest at an equilibrium point and that point is supposed to be the same irrespective of the interim fluctuations. Instead, as I told Congress, financial markets behaved more like a wrecking ball, swinging from country to country and knocking over the weaker ones. It is difficult to escape the conclusion that the international financial system itself constituted the main ingredient in the meltdown process.
The reality is that financial markets are self-destabilizing; occasionally they tend toward disequilibrium, not equilibrium.
There's been a dichotomy in the world financial markets over the last 30 years between the developed markets and the developing markets. Brazil, for example, always had to pay a lot more in interest to borrow money than governments in developed nations.
James Goldsmith is important because he used the power of the markets to break up the cosy patrician elite that ran Britain and its industries in the 1950s and '60s. In the process, Goldsmith helped transfer power in this country away from politics and towards the markets and the financial sector.
Do not trust financial market risk models. Despite the predilection of some analysts to model the financial markets using sophisticated mathematics, the markets are governed by behavioral science, not physical science.
Private equity capital in each of those markets Europe and Asia - while those markets have very different characteristics - fills a niche where either strategic investors or the public markets don't go, or don't want to go for some particular reason. I think that's going to continue to be the case going forward.
Developments in financial markets can have broad economic effects felt by many outside the markets.
The principal linkages between Japan and the U.S. global economies are trade, financial markets, and commodity markets.
The impact on the broader economy and financial markets of the problems in the subprime markets seems likely to be contained.
Isn't it interesting that markets are not just perfect? In business school and economic theory, you learn all about those perfect markets, and there's no such thing as a perfect market.
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