Affect Quote by Ben Bernanke
“Imperfect substitutability of assets implies that changes in the supplies of various assets available to private investors may affect the prices and yields of those assets.”
About This Quote
Source Speech: Remarks at the Economic Club of New York, 2006
When assets cannot be perfectly substituted, shifts in their availability influence market prices and returns.
In simple terms: Supply changes affect asset prices when assets aren't identical.
Key Takeaway
Consider supply impacts on asset valuations.
Themes
economics
finance
market dynamics
Mood
analytical
concerned
Type
theoretical
informative
When to use this quote
- portfolio management
- investment strategy
- policy analysis
- risk assessment
Key Concepts
imperfect substitutability
asset pricing
supply-demand interaction
Questions to Reflect On
- How do supply shocks alter your investment decisions?
- What assets are most sensitive to substitution limits?
A Different Perspective
Assumes markets are efficient; real-world frictions may dominate.
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