“Obviously, based on the crisis and what happened and the effects that we're still feeling, it's now clear that maintaining financial stability is just as an important a responsibility as monetary and economic stability. And indeed, this is, you know, very much a return to the—where the Fed came from in the beginning. Remember the reason that Fed was created was to try to reduce the incidents of financial panics, so financial stability was the original goal of creation of the Fed. So now we sort of come full circle.”

— Ben Bernanke

Lecture 4: The Aftermath of the Crisis
The Federal Reserve and the Financial Crisis (2012)

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Ben Bernanke 10

American economist 1953

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“I want to make sure you keep your eyes on the ball, that is, the two basic missions of a central bank. The first is maintaining macroeconomic stability: maintaining stable growth and keeping inflation low and stable. The principal policy tool for maintaining macroeconomic stability is monetary policy. In normal times, the Fed and other central banks use open market operations—purchases and sales of securities in markets—to move interest rates up or down, and in doing so try to create a more stable macroeconomic environment.
The second part of a central bank's mission is maintaining financial stability. Central banks are focused on trying to ensure that the financial system functions properly, and in particular, they want to prevent, if possible, and if not, to mitigate the effects of a financial crisis or a financial panic.”

Ben Bernanke (1953) American economist

Lecture 2: The Federal Reserve after World War II
The Federal Reserve and the Financial Crisis (2012)

“Massive concentration of financial power, accompanied by the machinations of finance capital, can as easily de-stabilize as stabilize capitalism.”

David Harvey (1935) British anthropologist

Introduction, p. xxxii
The Limits To Capital (2006 VERSO Edition)

“In rich economies, stability matters a lot; small further increases in allocative efficiency matter less. Thus, policy should be heavily focused on ensuring macroeconomic and financial stability and very wary of financial innovation if it carries with it any risk of increased instability.”

Adair Turner, Baron Turner of Ecchinswell (1955) British businessman

Source: Economics after the crisis : objectives and means (2012), Ch. 2 : Financial Markets: Efficiency, Stability, and Income Distribution

“Globalization creates interlocking fragility, while reducing volatility and giving the appearance of stability. In other words it creates devastating Black Swans. We have never lived before under the threat of a global collapse. Financial Institutions have been merging into a smaller number of very large banks. Almost all banks are interrelated. So the financial ecology is swelling into gigantic, incestuous, bureaucratic banks — when one fails, they all fall. The increased concentration among banks seems to have the effect of making financial crisis less likely, but when they happen they are more global in scale and hit us very hard. We have moved from a diversified ecology of small banks, with varied lending policies, to a more homogeneous framework of firms that all resemble one another. True, we now have fewer failures, but when they occur… I shiver at the thought.”

Nassim Nicholas Taleb (1960) Lebanese-American essayist, scholar, statistician, former trader and risk analyst

Source: The Black Swan: The Impact of the Highly Improbable (2007), pp. 225-226

“That is financial intelligence. It is not so much what happens, but how many different financial solutions you can think of to turn a lemon into millions. It is how creative you are in solving financial problems.”

Robert T. Kiyosaki (1947) American finance author , investor

Rich Dad Poor Dad: What the Rich Teach Their Kids About Money-That the Poor and the Middle Class Do Not!

“If our emotional stability is based on what other people do or do not do, then we have no stability. If our emotional stability is based on love that is changeless and unalterable, then we attain the stability of God.”

Marianne Williamson (1952) American writer

Source: Enchanted Love: The Mystical Power Of Intimate Relationships

“The frustration mainly comes from trying to understand what they really want. Also, you cannot understand how can such a large nation maintain its so-called stability by doing something very unlawful. I mean, how can they possibly manage to stabilize the whole social condition by not [acting with] justice and fairness.”

Ai Weiwei (1957) Chinese concept artist

2010-, You’re There but You’re Not Existing, 2012

“The explanation of this book is that the 1929 depression was so wide, so deep, and so long because the international economic system was rendered unstable by British inability and U. S. unwillingness to assume responsibility for stabilizing it by discharging five functions:(1) maintaining a relatively open market for distress goods;
(2) providing countercyclical, or at least stable, long term lending;
(3) policing a relatively stable system of exchange rates;
(4) ensuring the coordination of macroeconomic policies;
(5) acting as a lender of last resort by discounting or otherwise providing liquidity in financial crisis.”

Charles P. Kindleberger (1910–2003) American economic historian

The World in Depression, 1929-1939 (2nd ed., 1986), Ch. 14 : An Explanation of the 1929 Depression

“All of us in business have a responsibility to maintain the industrial base on which we depend and the society whose adaptability — and stability — we may have taken for granted.”

Andrew S. Grove (1936–2016) Hungarian-born American businessman, engineer, and author

Andrew Grove in: " Andy Grove’s Warning to Silicon Valley http://www.nytimes.com/2016/03/26/opinion/andy-groves-warning-to-silicon-valley.html?_r=0", New York Times, March 26, 2016
New millennium

“The 2008 financial meltdown is the result of under-regulated markets built on an ideology of free market capitalism and unlimited economic growth. The fundamental problem is that the underlying assumptions of this ideology are not consistent with what we now know about the real state of the world. The financial world is, in essence, a set of markers for goods, services, and risks in the real world and when those markers are allowed to deviate too far from reality, “adjustments” must ultimately follow and crisis and panic can ensue. To solve this and future financial crisis requires that we reconnect the markers with reality. What are our real assets and how valuable are they? To do this requires both a new vision of what the economy is and what it is for, proper and comprehensive accounting of real assets, and new institutions that use the market in its proper role of servant rather than master.”

Robert Costanza (1950) American economist

Source: Toward a New Sustainable Economy, 2008, p. 40

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