Bill Miller on how he's adapted his management style to the existence of black swans

We've always had a very robust set of strategies for dealing with all kinds of different kinds of markets, but I think the big mistake that we made, or that I made, was effectively to say, "We need a strategy to deal with anything that's happened in the post-war period." So, inverted yield curves, inflation, a crash like in '87, all different kinds of panics.

But I explicitly ruled out a return, in essence, to depressionary conditons, just like I ruled out a new Civil War, for example. Well, the answer, I think, is you can't rule out anything. Anything. I think you have to look at anything that can hit aggregate demand or aggregate supply. And that's the thing I think we're well prepared for now.

And also, understanding that there are two types of financial crises: one of them, which we've navigated in very well, like the crash of '87, which are liquidity-driven crises. The strategy in a liquidity-driven crisis is pretty simple, which is, when massive liquidity is injected, you buy what the center of the crisis is; in an asset-based crisis, like we had in 2008, that strategy is very bad, as we found out to our chagrin. The proper strategy there, in an asset-based crisis is, you don't do anything until the authorities move to stabilize asset values and preserve them. That was TARP. Everything the Fed had done or the government had done, the Treasury had done up until TARP destroyed equity value. So, wipe equity holders out at Bear Stearns and wiped them out, and even creditors, at Lehman Brothers.

Once they decided to preserve equity values with TARP, that was the beginning of the end of the crisis. That was the time you go in and buy. So, I think we're covered on both kinds of crisis in the future.

~Bill Miller, chairman and CIO, Legg Mason Capital Management, CNBC's Squawk Box, April 6, 2011

Mark Haines on George W. Bush's comment that "TARP saved the economy"

Way to stick up for what you did. Because I believe you were right.

~ Mark Haines, CNBC, 10:55 AM Eastern time, November 5, 2010

Neel Kashkari on calculating the cost of the TARP bailout

We have $11 trillion residential mortgages, $3 trillion commercial mortgages. Total $14 trillion. Five percent of that is $700 billion. A nice round number.

Seven hundred billion was a number out of the air. It was a political calculus. I said, ‘We don’t know how much is enough. We need as much as we can get [from Congress]. What about a trillion?’ ‘No way,’ Hank shook his head. I said, ‘Okay, what about 700 billion?’ We didn’t know if it would work. We had to project confidence, hold up the world. We couldn’t admit how scared we were, or how uncertain.

~Neel Kashkari, former Interim U.S. Assistant Secretary of the Treasury for Financial Stability, ex-Goldman Sachs banker, "Neel Kashkari's Fuzzy TARP Math," WSJ.com, December 7th, 2009

Karen Finerman, Fast Money trader, on the ineffective TARP bailout

When we think about TARP, we thought we were turning on a firehouse when we said $700 billion for TARP, and that really didn't do anything. That didn't even last for that day, the market went straight down.

~Karen Finerman, "The Chairwoman", CNBC Fast Money, May 10th, 2010

Mark Zandi on the policy response to recession

The only way out is for the government to be extremely aggressive, from the Federal Reserve to economic stimulus to the TARP. 

~ Mark Zandi, as appeared on CNBC, December 5, 2008