Remarks at the Council on Foreign Relations Corporate Conference 2009, New York City.

Remarks at the Council on Foreign Relations Corporate Conference 2009, New York City.

Inflation risk is greatest in times of national or global stress; inflation risk is a form of a “tail risk.” A traditional portfolio of stocks and bonds is exposed to inflation risk. The specific nature of an investor's liabilities and spending determines inflation sensitivity beyond that of...

I use the global crisis of 1914 as a window onto the phenomenon of investor reaction to complex news — such as sudden political upheaval. Based on a novel database of all stocks traded on the NYSE during 1914, along with “real-time” news accounts from major newspapers, I show that NYSE...