It’s page 132 from Edward Chancellor’s Best 2022 book, The Value of Time: The True Story of Desire (footnote deleted; link added)
The Federal Reserve’s reactionary tendency to ease monetary conditions encourages more risk-taking whenever markets are in turmoil. [Claudio] Borrio observed that central bankers were slow to pick up pace during spikes but rushed to ease them after each punch. They noted that their asymmetric approach showed a low bias for interest rates and a high bias for debt. Risks from Fed imbalances were a long-term concern.“Lowering rates when problems arise, or providing adequate liquidity but not raising prices when imbalances increase, can be very dangerous in the long run. They encourage moral hazard that can sow instability and havoc in the real economy.”
DBXChancellor goes on to say that the inside quote was written (in a paper co-authored by Claudio Borio and Philip Lowe) in 2002.
Alan Greenspan (pictured here) was not the money maestro many made him out to be. His successors were no better.
