asset bubbles

That in turn could fuel asset bubbles like the one China is arguably trying to deal with in its real estate market.

The eurozone as a whole did not suffer huge asset bubbles and consequent financial crises: these were limited to a few peripheral members.

Asset bubbles could be the next fragility as the world recovers, threatening again to destroy livelihoods and trap millions more in poverty.

First, macroeconomic management must be able to identify asset bubbles and to muster the political will to respond.

As crises go, it's very different but ultimately just as painful for investors as the asset bubbles that draw all our attention now.

Second, to control asset bubbles it is not enough to control the money supply; we must also control the availability of credit.

But this form of financial repression brings its own dangers: asset bubbles, excess capacity and overinvestment.

The Fed has long argued that central bankers should not try to prick asset bubbles, but must mop up the mess promptly when they burst.

Macroeconomic risks linked to excessive liquidity, inflation, asset bubbles and a cyclical rise in bad bank loans are rising significantly.

Macro-economic risks linked to excessive liquidity, inflation, asset bubbles and a cyclical rise in bad bank loans are rising significantly.

Second, to control asset bubbles it is not enough to control the money supply; you must also control credit.

One of the biggest concerns that economists and analysts have about low interest rates is the formation of asset bubbles.

Monetary policy may be a blunt tool to deal with asset bubbles. But that does not mean it is irrelevant.

But they may have to be reined in to avoid overheating, inflation and asset bubbles.

When markets wobbled, central banks slashed interest rates. A by-product of this policy was a series of debt-financed asset bubbles.

It recommended a tighter monetary policy as well as a stronger exchange rate to restrain inflation and asset bubbles.

He said that Asia, which is leading the rebound, risked seeing asset bubbles fuelled by capital inflows.

When the dollar began to rebound, in 1996, Asian economies came under tightening pressure that burst their asset bubbles.

But central banks struggled to avoid a deflationary outcome; the result was a loose monetary policy that encouraged asset bubbles.

After all, we've just been through two horrible asset bubbles -- and busts -- in the U. S. and global financial markets.

A stronger, more flexible currency would make it easier for China to control inflation and asset bubbles.

But will the economy collapse if any of these asset bubbles burst?

Two asset bubbles, two recessions and a financial crisis certainly took their toll.

SINCE the bursting of Japan's asset bubbles in the early 1990s, the country has undergone a long and deflationary process of debt reduction.

And asset bubbles can be deflated through limits on some sorts of borrowing rather than just interest-rate hikes.

Japan proved equally prone to creating asset bubbles as the US, even though its banking system was under much closer state guidance.

Mr Neumann fears these might turn out to be too timid to prevent runaway inflation or the emergence of asset bubbles in some countries.

Isolated worries about asset bubbles have been replaced by a fear of broader overheating.

Many are already overheating, with prices rising and asset bubbles inflating. Most have inappropriately loose monetary policy.

Such flows could create asset bubbles, reducing the effectiveness of a rate hike.

Macroeconomists, especially within central banks, were too fixated on taming inflation and too cavalier about asset bubbles.

Instead, the looseness of global liquidity will translate into asset bubbles, in things ranging from gold bullion to Beijing apartments.

The current financial crisis started due to the uncontrolled, worldwide debt and asset bubbles.

Earlier, he had acknowledged concerns about asset bubbles, likening property markets in some big cities to a "wild horse" .

If the peg persists, it will not be long before the Swiss feel the effects of monetary expansion in inflation, asset bubbles or both.

Asset bubbles emerge when the dominant motive for purchase is the expectation of selling on soon to someone else at a higher price.

They ignored or failed to spot huge asset bubbles and banks' kamikaze behaviour.

Chinese officials have sounded increasingly antsy about asset bubbles and unproductive loans.

Now the Fed is under attack at home, as Republicans accuse it of fuelling asset bubbles and inflation (see article).

This could lead to a concentration of risk, including a buildup of sovereign debt or asset bubbles in domestic capital markets.

The natural state of capital markets from which fear has been removed is the generation of asset bubbles.

Monetary policy may be a blunt tool to deal with asset bubbles.

Then, with the financial crisis and the bursting of asset bubbles, came household deleveraging and fiscal leveraging.

By contrast, there were no asset bubbles to speak of in the Bretton Woods era and (not coincidentally) scarcely any financial crises.

The European Central Bank, for one, is coming round to the idea that it may need to respond to asset bubbles.

Most will probably plump for easier money and higher growth, even at the risk of future inflation and asset bubbles.

The problem will be most acute in emerging economies. Many are already overheating, with prices rising and asset bubbles inflating.

When monetary conditions in the rich world are loose, emerging economies are prone to lending binges and asset bubbles.

For developing economies, however, rapid growth can bring rising inflation and asset bubbles.

The goal is to prevent inflation and address asset bubbles-especially in the property market-without pulling growth down too far.

There are already signs China's authorities are worried that the unprecedented surge in money supply will cause asset bubbles and inflation.

So the surplus continues to build up, creating distorted investment decisions and asset bubbles at home.

Heyzer said that along with inflation, capital asset "bubbles" have appeared because of the "money flight" from the Middle East.

But, for the region to remain on a path of sustained expansion, policy-makers need to heed the risks of asset bubbles.

A significant portion of the QE2 could then leak offshore, sparking asset bubbles in high-return developing economies.

Across the region, we are seeing asset bubbles both in housing and equity markets.

Interest rates in China are negative in real terms, fuelling asset bubbles and get rich schemes for those able to borrow.

Real estate bubble is the main manifestation of asset bubbles, once itcollages, the damage to society and economic will be serious.

Much is leaking out into real estate and equity investments, creating concerns about asset bubbles.

There's no question, however, that it is fuelling inflation and asset bubbles in emerging markets.

The excess liquidity has led to the resurgence of asset bubbles.

If an EM imposes capital controls to deal with asset bubbles, that's probably a good thing.

And everybody needs to work harder on understanding asset bubbles and what happens when they burst.

China can radically mess up, for example, if it allows asset bubbles to build or if it fails to stave off political upheaval.

Unlike previous asset bubbles gold is a tiny fraction of total global investment capital.

But one thing is certain: when it comes to asset bubbles, bigger is not better.

Many are already overheating, with prices rising and asset bubbles inflating.

Otherwise negative real interest rates will inflate asset bubbles.

Some would still blame the Fed, for not deflating asset bubbles with higher interest rates.

Japan's economic problems, like ours, originated in huge asset "bubbles. "

Capital flows will also remain a problem as China tries to rein in inflation and asset bubbles.

For a hint of the future, look to Asia, where a new risk is emerging: asset bubbles.

It would stoke inflation and asset bubbles in developing economies: annual inflation in Brazil is running at 6. 85 percent.

Growth, inflation, and asset bubbles followed.

The Fed could then focus on setting market-wide capital ratios to damp asset bubbles.

The IMF also notes incipient asset bubbles in Asian-Pacific real estate and some Latin American equity markets.

As it orders banks to lock up more cash, Beijing is demonstrating it is on guard against asset bubbles that can accompany inflation.

But the credit boom has also raised worries about the potential for asset bubbles and inflation.

Many believe this is bound to lead to another upswing in bad debt and destabilising asset bubbles.

Nor would it avoid the need to watch for asset bubbles as a separate concern.

This not only cannot curb inflation, will cause China to contain more big, the asset bubbles - was hot money drowned.

Adding to fears of resurgent asset bubbles, the benchmark Chinese stock index has surged nearly 13 per cent in just the past two weeks.

This pace will, and should, slow, not least because the big emerging economies need to tackle rising inflation and possible asset bubbles.

These are the countries that had the biggest credit booms and asset bubbles.

He is concerned about asset bubbles forming in real estate, banking, and in the stock market.

Asset bubbles typically form because of widespread denial, not a lack of obvious signs.

The costs in inflation and asset bubbles are high.

In recent months, a growing number of analysts, and some Chinese officials, have also warned that asset bubbles might emerge in China.

In China, officials worry that continued stimulus could create unsustainable asset bubbles.

They do, and authorities need to counteract them to prevent asset bubbles growing too large.

The bad news is that it led central banks to sit idly by while asset bubbles inflated.

The G-20 is also counting on the IMF to develop early warnings of impending asset bubbles and other major problems.

In China, a huge, state-directed lending binge has propped up demand but is also fuelling asset bubbles, especially in property.

The result is that asset bubbles are building in China and other Asian markets 'that might end in tears in a few years time, ' he says.

It can also spark asset bubbles, exacerbating the inflation that rate increases are meant to combat.

"Inflation and the asset bubbles are now supporting each other. This is very dangerous, " says the economist.

That is why asset bubbles could grow so large during his tenure.

But, because of where China is with asset bubbles, people want to buy the assets regardless of whether they can be leased out or not.

There are already signs that high inflation rates combined with low interest rates are creating asset bubbles in Hong Kong.

Third, do not mis-allocate your capital and resources so as to create asset bubbles;

worldwide asset bubbles and inflation

World Economy after the Bursting of Asset Bubbles