Quotes & Sayings About Liquidity

I haven't studied it deeply, but the American banks started the crisis with far more capital and what I would call "good liquidity." The riskiest funding is unsecured wholesale funding. It's the most fickle. Not repo, which the government focused on, too. Unsecured. JPMorgan Chase had almost none of that - virtually zero. — Jamie Dimon

Helping Wall Street regain confidence and stability was the last thing an angry public wanted in 2009 after the markets crashed. But without such support, markets can buckle and liquidity can disappear - often for decades, as has been the case in Japan. — David Ignatius

Any central bank should only be in charge of liquidity. Solvency is a matter for the treasury. — George Soros

The Algo Wars were leaving a path of destruction in their wake. "HFT algos reduce the value of resting orders and increase the value of how fast orders can be placed and cancelled," wrote Nanex researcher Eric Hunsader. "This results in the illusion of liquidity. We can't understand why this is allowed to continue, because at the core, it is pure manipulation. — Scott Patterson

I worked for twenty-some years with no capital, so I never had any liquidity. Managing my loans alone wouldn't do it, and working hard twenty-four hours a day seven days a week alone wouldn't do it. You have to be properly capitalized. — Bob McNair

Hedge funds, private equity and venture capital funds have played an important role in providing liquidity to our financial system and improving the efficiency of capital markets. But as their role has grown, so have the risks they pose. — Jack Reed

The role of liquidity in systemic events provides yet another reason why, in the future, a more system wide or macroprudential approach to regulation is needed. — Ben Bernanke

We invite American companies looking to raise capital to list on the Bahrain Stock Exchange. The region has a liquidity oversupply approximating $1 trillion and this pool of capital can be tapped into by creative American companies. The next Facebook may very well get funded on the BSE. — Hamad Bin Isa Al Khalifa

There's such a preoccupation with liquidity and such an unwillingness to invest beyond the horizon of the next quarter and making sure that the CEOs hit their quarterly earnings. — Edmund Phelps

Other countries have access to the markets, whereas Greece does not. Therefore, we have to get liquidity through the ECB. — Antonis Samaras

Liquidity. When an executive said his bank had plenty of liquidity it always meant that it didn't. At — Michael Lewis

One may not doubt that, somehow Good Shall come of Water and of Mud; And sure, the reverent eye must see A purpose in Liquidity. — Rupert Brooke

Our liquidity is fine. As a matter of fact, it's better than fine. It's strong. — Kenneth Lay

The reason I am so negative about the Federal Reserve's policies is that they only target core inflation and argue that they can't identify bubbles, but when each bubble bursts, they flood the system with liquidity that brings about unintended consequences. — Marc Faber

In Chapter 5 we consider swindles and defalcations. It happens that crashes and panics often are precipitated by the revelation of some misfeasance, malfeasance, or malversation (the corruption of officials) engendered during the mania. It seems clear from the historical record that swindles are a response to the greedy appetite for wealth stimulated by the boom. And as the monetary system gets stretched, institutions lose liquidity, and unsuccessful swindles are about to be revealed, the temptation to take the money and run becomes virtually irresistible. It is difficult to write on this subject without permitting the typewriter to drip with irony. An attempt will be made. — Charles P. Kindleberger

What I'm after is the liquidity of things, how one things leads you on to the rest ... The works are about concentration, intention, and paths of thought: the flow of totality in our perception, the fragmentation of the river of phenomenon. — Gabriel Orozco

When making their loans, the bankers should have thought more carefully about how easily they could call back the money - essentially a question about the liquidity of the loan. — Niall Ferguson

bear in mind when trying to compare housing with other forms of capital asset. The first is depreciation. Stocks do not wear out and require new roofs; houses do. The second is liquidity. As assets, houses are a great deal more expensive to convert into cash than stocks. The third is volatility. — Niall Ferguson

When I hear complaints about less liquidity, remember there is such a thing as too much liquidity. — Paul Volcker

From my point of view, the American financial system - including banks and investment banks - is far safer because of capital and liquidity requirements. Despite all the turbulence so far this year, I don't think anyone's questioning our system. And that, obviously, is a good thing. — Jamie Dimon

When the Eurozone was started, a fundamental stabilising force that existed at the level of the member-states was taken away from these countries. This is the lender of last resort function of the central bank." EZ governments, "could no longer guarantee that the cash would always be available to roll over the government debt." Unlike stand-alone nations, EZ members did not have "the power to force the central bank to provide liquidity in times of crisis." This created a fundamental fragility in the monetary union. Without a buyer-of-last-resort, shocks that provide re-funding difficulties in banks or nations can trigger self-fulfilling liquidity crises that degenerate into solvency problems. — Richard Baldwin

If you look at some of the smaller capital markets in Asia, when they want funding, they either come here to Hong Kong or they go to California, the mecca of the Internet, because they can capture the liquidity and then move on and do what they want to do, which is develop a business. — Richard Li

The Fed has gone about as if the problem is a shortage of liquidity. That is not the basic problem. The basic problem for the markets is that uncertainty that the balance sheets of financial firms are credible.
-Anna J. Schwartz interviewed in the Wall Street Journal, October 18-19, 2008. — John Brian Taylor

Actually, I have been very supportive of a very robust stimulus package from day one. I think this economy has to have a major stimulus initiative because the only group with liquidity is the federal government. — Judd Gregg

Among other objectives, liquidity guidelines must take into account the risks that inadequate liquidity planning by major financial firms pose for the broader financial system, and they must ensure that these firms do not become excessively reliant on liquidity support from the central bank. — Ben Bernanke

Near the top of the market, investors are extraordinarily optimistic because they've seen mostly higher prices for a year or two. The sell-offs witnessed during that span were usually brief. Even when they were severe, the market bounced back quickly and always rose to loftier levels. At the top, optimism is king, speculation is running wild, stocks carry high price/earnings ratios, and liquidity has evaporated. A small rise in interest rates can easily be the catalyst for triggering a bear market at that point. — Martin Zweig

There has to be a large number of people and routes that are lined up together. One part is liquidity and the other part is product - there's a lot that can go wrong. — Travis Kalanick

the Bank's proper role in a crisis as the 'lender of last resort', to lend freely, albeit at a penalty rate, to combat liquidity crises.42 — Niall Ferguson

I expect my return to be 18 to 25 percent in 1988, while the Standard & Poor's 500 should rise 8 to 12 percent and OTC stocks gain 15 percent as liquidity emerges. — Louis Navellier

Then, when the Fed's fire hoses started spraying an elephant soup of liquidity injections in every direction and its balance sheet grew by $1.3 trillion in just thirteen weeks compared to $850 billion during its first ninety-four years, I became convinced that the Fed was flying by the seat of its pants, making it up as it went along. It was evident that its aim was to stop the hissy fit on Wall Street and that the thread of a Great Depression 2.0 was just a cover story for a panicked spree of money printing that exceeded any other episode in recorded human history. — David Stockman

As you know, in the latter part of 2008 and early 2009, the Federal Reserve took extraordinary steps to provide liquidity and support credit market functioning, including the establishment of a number of emergency lending facilities and the creation or extension of currency swap agreements with 14 central banks around the world. — Ben Bernanke

The Central Bank should have a permanent window for discounting high quality securities where banks could go and discount these. It gives peace of mind to the banks. In the absence of this facility, what banks tend to do is to keep a liquidity cushion for emergency requirements. This is a very expensive way of managing liquidity. — Abdul Aziz Al Ghurair

[T]he ABCP market was built on a fatal flaw: a significant mismatch between the duration of the underlying assets (long-term) and the duration of the paper itself (short-term). While this structure is not unusual -- banks use it all the time -- the crucial difference is that banks have a strong liquidity provider in the event of a problem: the Bank of Canada. The trusts, however, were left in limbo. — Paul Halpern

Nevertheless, if we contemplate a society with a somewhat stable wage-unit, with national characteristics which determine the propensity to consume and the preference for liquidity, and with a monetary system which rigidly links the quantity of money to the stock of the precious metals, it will be essential for the maintenance of prosperity that the authorities should pay close attention to the state of the balance of trade. For a favourable balance, provided it is not too large, will prove extremely stimulating; whilst an unfavourable balance may soon produce a state of persistent depression. — John Maynard Keynes

The monetary policy of the United States has a major impact on global liquidity and capital flows and therefore, the liquidity of the U.S. dollar should be kept at a reasonable and stable level. — Hu Jintao

well-functioning market requires all three types of investors for socially beneficial projects to have access to cheap capital. Value investors allocate capital to its most productive use. Speculators, because they trade frequently, provide the liquidity and trading volume that allows value investors and relative value traders to execute their trades cheaply. They also ensure that information is disseminated quickly. — Michael Pettis

To be sure, the provision of liquidity alone can by no means solve the problems of credit risk and credit losses; but it can reduce liquidity premiums, help restore the confidence of investors, and thus promote stability. — Ben Bernanke

The IMF is set up to deal with liquidity crises. — Steve Hanke

My wealth came from growing businesses. I had wealth, but not liquidity. Basically I transferred illiquid shares of AIC for liquid shares of Manulife. Now I'm the biggest individual shareholder of Manulife. — Michael Lee-Chin

So why didn't ABCP investors -- at least the large institutional investors -- have a better grasp of the uncertain nature of market disruption triggers as defined under Canadian-style liquidity? Probably because the contracts were not available for review to investors wishing to purchase ABCP -- yet another example of the lack of transparency surrounding the distribution and sale of this product. — Paul Halpern

We can't count on the Fed to inject this level of liquidity that we saw last year. — Robert Pozen

We really believe in the earnings. We're very proud that often we do well in the down market. But you know, there are some markets where they just lose liquidity, like 2001, 2008. — Louis Navellier

I never use hedge funds because I am well aware of what drives future performance, and hedge funds start out with a great disadvantage in every major category: taxes, fees, risk management, transparency and liquidity. — Peter Mallouk

For most, the largest asset is their home. This becomes a sentimental issue, I know, but if you're holding on to a home that you can no longer afford - or you need the liquidity - you need to think about solutions. One might be to bring in a tenant or roommate; a more drastic measure is to sell the home and downsize. — Jean Chatzky

I think the notion that liquidity of tradable common stock is a great contributor to capitalism is mostly twaddle. The liquidity gives us these crazy booms, so it has as many problems as virtues. — Charlie Munger

The failure of Lehman Brothers demonstrated that liquidity provision by the Federal Reserve would not be sufficient to stop the crisis; substantial fiscal resources were necessary. — Ben Bernanke

One way to ease liquidity for banks is that the government can buy all highly rated securities held by the banks. Every single bank in the U.A.E. has some sovereign debts in their portfolios. I am not asking them to buy any junk bonds, rather the high quality U.A.E. government debt. — Abdul Aziz Al Ghurair

Why, just a couple of economic seasons ago, was idle cash considered an indication of bad management or lazy management? Because it meant that management didn't have this money out at work ... Now look. Presto! A new fashion! Cash is back in! Denigrating liquidity has dropped quicker than hemlines. A management is now saluted if it has some cash, some liquidity, doesn't have to go to the money market at huge interest rates to get the wherewithal to keep going and growing. Along with Ben Franklin, my father and your father would understand and applaud this new economic fashion ... — Malcolm Forbes

Housing associations have fingered the fact that they cannot use their assets as liquidity due to Bank of England rules unlike their continental equivalents. This has emerged to be one of the main bottlenecks to getting investment going in the U.K. It is a Bank of England issue. — Vince Cable

We have to keep the momentum going in the economy. And we have to make sure that we give small businesses as much cash and liquidity as possible so they have the confidence to hire that next worker. — Karen Mills

They flooded liquidity in the marketplace but the mortgage rate is based much more on expectations of inflation. So if the average investor believes that there is inflation coming, they'll move that rate up. — Franklin Raines

Of the maxims of orthodox finance none, surely, is more anti-social than the fetish of liquidity, the doctrine of that it is a positive virtue on the part of investment institutions to concentrate their resources upon the holding of 'liquid' securities. It forgets that there is no such thing as liquidity of investment for the community as a whole. — John Maynard Keynes

The crisis prompted the issue of emergency paper money: in Britain, £1 and 10s Treasury notes; in the United States, the emergency currency that banks were authorized to issue under the Aldrich-Vreeland Act of 1908.46 Then, as now, the authorities reacted to a liquidity crisis by printing money. — Niall Ferguson

capital, having considerably more liquidity than water, slid — Kim Stanley Robinson

The event concept was sparked from a shared observation amongst these leading lifestyle brands that the economic rebound has spurred greater liquidity into real estate, the stock market is setting new heights and consumers are generally stepping out more for luxury goods and services. After many years of pulling back, it was fun to see guests flirting with temptation, whether that was a new home, a new car, a new look or just to learn more about the trends. Others were happy to take in all the action. — Andrea Savage

Five hundred years ago the notoriously savvy Henry VIII discovered an elegant way to solve both his theological problems and his personal liquidity crisis - he dissolved the monasteries and nicked all their land. Since the principle of any rich person who wants to stay rich is, never give anything away unless you absolutely have to, the land has stayed with Crown ever since. — Ben Aaronovitch

Another lesson is that smart professionals might give an instruction to a program based on a sensible-seeming and normally sound assumption (e.g. that trading volume is a good measure of market liquidity), and that this can produce catastrophic results when the program continues to act on the instruction with iron-clad logical consistency even in the unanticipated situation where the assumption turns out to be invalid. The algorithm just does what it does; and unless it is a very special kind of algorithm, it does not care that we clasp our heads and gasp in dumbstruck horror at the absurd inappropriateness of its actions. This is a theme that we will encounter again. — Nick Bostrom

JP Morgan always has higher capital liquidity, that is partially to make up for mistakes and problems and obviously it's a tough economy. We support an oversight committee, we supported some of the compensation, new compensation rules, though we already follow most of them. We support a lot of it. — Jamie Dimon

The destruction of the inducement to invest by an excessive liquidity-preference was the outstanding evil, the prime impediment to the growth of wealth, in the ancient and medieval worlds. — John Maynard Keynes