Photo: Chip Somodevilla/Getty
In a surprise move, Goldman Sachs spokesman Lucas Van Praag gave a wide-ranging and almost 40 minute long interview with the Dutch television show ‘Backlight’ last week.The full interview has been circulating through the U.S. financial media for a couple of days.
The discussion was intended to consist of just Van Praag reading a prepared statement but turned into much, much more.
Van Praag re-hashed the Goldman’s role in events of the financial crisis, subsequent bank regulation and the Eurozone crisis. The full interview is well worth listening to, but in our view, the most important thing Van Praag said was the following:
“I don’t think there is going to be a crisis like this one again. I think that there will inevitably be crises in the future. I think people generally learn from the mistakes of the past and try very hard not to repeat them. But I don’t think that means that society, the world will avoid other crises. The reality is that we are probably in a bubble right now. We just don’t know what it is.”
Hardly comforting words, to be sure. But the simple fact that there is rarely widespread agreement on the existence of a bubble until it’s too late for adequate intervention is generally true.