In The International Economy, Summers, the Harvard professor takes on the subprime crisis, moral hazard, and Alan Greenspan's inflation forecast. Here are a few excerpts:
"I am not one who shares as fully as others the obsession with moral hazard. The mirror image of moral hazard is confidence..."
"There are plenty of predatory abuses that we should correct, but we need to be careful about succumbing to a sadomasochistic 'We need pain or we'll become complacent' sort of world view..."
"...harmony had been purchased at the expense of ambiguity..."
"We only call it a bubble in history if it did burst...In the fall of 1996 when Alan Greenspan used the term "irrational exuberance," the Dow was in the 6,000s. That was a declaration of a bubble that wasn't."