Lacy Hunt Quotes (18 Quotes)

To have an effective monetary policy, you have to have a robust borrowing and lending cycle, ... The problem is that households and businesses are both overextended, while banks have problems with their current loan base. So we don't have a viable borrowing and lending cycle, which means that monetary policy is not working effectively.

It was not used this time, even though it was debated in Fed circles -- Greenspan opposed it.

Powerful restraining forces are impacting the consumer, and this will result in slower growth in the latter part of this year and into 2005,

In the past two years, we've seen the budget go from surplus to deficit, adding about 400 billion of stimulus to the economy, but we've still lost 2.5 million private-sector jobs.

The ratio of corporate debt to gross domestic product (GDP) is at an all-time high, ... And we don't know exactly what corporate debt is because so much has been parked off the balance sheet and hidden. But, even without knowing what the off-balance-sheet debt is, corporations have too much.

The Fed's raising rates is highly doubtful. The road to recovery will be very difficult and very uncertain. Inflation will continue working its way lower.

When you have a large debt buildup and a lot of excess capacity, that's not corrected very quickly.

When we came out of the recession in March of 1991, GDP started rising very feebly, while the unemployment rate continued rising for another year and a half, ... The press called it a 'jobless recovery,' and it was one of the reasons President Bill Clinton was able to defeat former President George Bush. The average person on the street judges the economy by the job market.

In Japan, for example, the debt deflation started in 1990 and price deflation started in 1992 or 1993. That's what we're in for right now.

When consumers shift their income stream from purchases to saving, it slows GDP, and that's a long-term process, ... I think interest rates are going to remain very low for a couple of years.

Real income growth is deteriorating because of job losses, and income growth is going to remain weak until such time as it's reversed by a tax cut, which is months away at the earliest. Then there's a huge wealth loss from the stock market and no pent-up demand for goods.

This isn't going to be settled overnight, ... In New York, there will be debris removal and shoring up subway lines, but not massive reconstruction. People will use up the extra space available in New York, New Jersey and Connecticut. That doesn't mean they're going to be building new buildings.

The net effect was to induce a tightening mode in the markets, in bank lending and in total bank reserve growth, while interest rates rose significantly, especially for corporate bond issues. In retrospect, that's not looking very smart.

The country is entering a period of debt deflation, where households and businesses are forced to move funds from spending to debt repayment. This forces down economic growth and reduces inflationary pressures and long-term interest rates.

I don't think any benefit of the dividend tax elimination is worth the increase in the deficit.

This economy is not producing jobs in a normal way. We have serious global competitive pressures working on the economy. There continues to be a very rapid increase in productivity, which is undermining demand for labor.

The Fed was given control of margin lending in response to the excess speculation in the 1920s,

The problem is, the private sector doesn't have the balance sheet capacity to take on more debt, and the banking system is not in a position to extend more credit. So monetary policy may not work at all.