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Boom and Bust

1. Steel prices cause inflation like wet sidewalks cause rain.

Roger Blough (1904-85) U.S. business executive, chairman of U.S. Steel Corporation. Forbes (1967)


2. The problem established firms seem unable to confront successfully is that of downward vision and mobility, in terms of the trajectory map.

Clayton M. Christensen (b.1952) U.S. writer. The Innovator’s Dilemma (1997)


3. In the next economic downturn there will be an outbreak of bitterness and contempt for the supercorporate chieftains who pay themselves millions. In every major economic downturn in U.S. history the “villians” have been the “heroes” during the preceding boom.

Peter F. Drucker (b.1909) U.S. management consultant and academic. Quoted in “Seeing Things as The Really Are,” Forbes (Robert Lenzner and Stephen S. Johnson; 1987)


4. Once again, Chairman Greenspan and the Federal Reserve have mugged America.

Henry Gonzalez (1916-2000)U.S. politician. Referring to an interest-rate hike. BusinessWeek (1994)


5. Regrettably, history is strewn with the visions of such “new eras” that, in the end, have proven to be a mirage. In short, history counsels caution.

Alan Greenspan (b.1926) U.S. economist and chairman of U.S. Federal Reserve Board. September 9, 1997. Said in testimony before Congress on September 9, 1997. Financial Times (London)  (1997)


6. A depression is either a 12 percent unemployment rate for nine months or more, or a 15 percent unemployment rate for three to nine months.

Alan Greenspan (b.1926) U.S> economist and chairman of U.S. Federal Reserve Board. 1982. New York Times Magazine (William Safire; 1997)


7. There is no evidence that the business cycle has been repealed.

Alan Greenspan (b.1926) U.S. economist and chairman of U.S. Federal Reserve Board. Wall Street Journal (1997)


8. Gentlemen, you have come sixty days too late. The depression is over.

Herbert Hoover (1874-1964) U.S. president. June 1930. Reply to a delegation calling for a public-works program to alleviate some of the impact of the Great Crash of October 1929. The worst effects of the Great Depression were still to come. Quoted in The Crisis of the Old Order (Arthur M. Schlesinger, Jr; 1957)


9. I see nothing in the present situation that is either menacing or warrants pessimism…I have every confidence that there will be a revival of activity in the spring, and that during this coming year 1930 the country will make steady progress.

Andrew William Mellon (1855-1937) U.S> financier, industrialist, and public servant. 1929. Quoted in American Chronicle (Lois and Alan Gordon; 1987)


10. Liquidate labor, liquidate stocks, liquidate farmers.

Andrew William Mellon (1855-1937) U.S> financier, industrialist, and public servant. Said to Herbert Hoover when Mellon was Treasury Secretary. Quoted in Wall Street Journal (1974)


11. Inflation is as violent as a mugger, as frightening as an armed robber, and as deadly as a hit man.

Ronald Reagan (b.1911) U.S> former president and actor. Los Angeles Times (1978)


12. A depression is a situation of self-fulfilling pessimism.

Joan Robbinson (1903-83) British economist. “The Short Period,” Economic Heresies (1970)


13. Wall Street Lays An Egg

Sime Silverman (1873-1933) U.S. founder, publisher, and editor of Variety. Headline following the Wall Street crash. Variety (October 1929)


14. 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.

George Soros (b.1930) U.S. financier, entrepreneur, and philanthropist. Speech to the MIT Department of Economics, World Economy Laboratory Conference, Washington, D.C. “The Theory of Reflexivity” (April 26, 1994)


15. What we used to say was bring on the recession. Recession drove people to church, and they realized they were missing their Bible.

Hargis Thomas (b.1950) U.S. publisher. Speaking as director of Bible sales and marketing at Oxford University Press. Economist (1996)