A Quote by Robert F. Engle
When large companies take on risk, then they impose risks on the rest of the system. And these are systemic risks and these systemic risks we never used to think were really that important, but as soon as we recognize how the financial sector - the risks the financial sector takes on can impact the entire global economy, we realize that those risks needed to be controlled for the social good.
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The trouble is that the risks that are being hedged very well by new financial securities are financial risks. And it appears to me that the real things you want to hedge are real risks, for example, risks in innovation. The fact is that you'd like companies to be able to take bigger chances. Presumably one obstacle to successful R&D, particularly when the costs are large, are the risks involved.
There are some risks we choose to take because the benefits from taking them exceed the possible costs. Optimal behavior takes risks that are worthwhile. This is the central paradigm of finance: we must take risks to achieve rewards, but not all risks are equally rewarded.
While it may be theoretically possible to demonstrate the risks inherent in any treaty... the far greater risk to our security are the risks of unrestricted testing, the risks of a nuclear arms race, the risks of new nuclear powers.
The thing is doing it, that's what it's all about. Not in the results of it. After all what is a risk? It's a risk not to take risks. Otherwise, you can go stale and repeat yourself. I don't feel like a person who takes risks. Yet there's something within me that must provoke controversy because I find it wherever I go. Anybody who cares about what he does takes risks.
The trick is to take risks and be paid for taking those risks, but to take a diversified basket of risks in a portfolio.
If designers are willing to take risks, I think buyers should take risks, as well with press taking risks.
With government deregulation and the triumph of financial liberalization, the dangers of systemic risks, the possibility of a financial tsunami, sharply increased.
The Federal Reserve has a responsibility to ensure the safety and soundness of financial institutions and to contain systemic risks in financial markets.
I think that's something that investment banks have worried about for a long time and are continuing to worry about, but it's not an easy solution when you have lots of people betting the company's money, how do you really allocate those risks? How do you make sure that the people that take the risks are feeling the risks in an appropriate kind of fashion?
The thing I preach constantly is do your research; build your knowledge base. Don't just go into business on a whim or a prayer - and don't think 'I'm an entrepreneur so I have to take risks'. Entrepreneurs don't take risks. They take calculated risks; only the good ones.
Diversifying sufficiently among uncorrelated risks can reduce portfolio risk toward zero. But financial engineers should know that's not true of a portfolio of correlated risks.
The heart of the 2008 financial crisis was a coterie of reckless financial executives, working for too-big-to-fail financial companies, who were handsomely compensated for taking risks that almost ruined the economy when they failed.
From my perspective, as an entrepreneur, one is wired to take risks. You, of course, need to be smart and take calculated risks, and then do all you can to make it worth the risk.
When gene therapy was believed to harbor latent risks, research was largely put on hold until the risks were better understood. Sometimes, the theoretical risks have led to a principle of absolutist precaution that impedes progress.
Just taking risks for risk's sake, that doesn't do it for me. I'm willing to take risks that I think are worth it, and I've worked so hard to make sure that I survive.
...the more risks you allow children to take, the better they learn to take care of themselves. If you never let them take any risks, then I believe they become very prone to injury. Boys should be allowed to climb tall trees and walk along the tops of high walls and dive into the sea from high rocks... The same with girls. I like the type of child who takes risks. Better by far than the one who never does so.
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