Acording to Kaplan and Saddock, "thought latency" is "the period of time between a thought and its verbal expression." It is increased in schizophrenia (often referred to as blocking), while increased during manic episodes (referred to as pressured speech).
In schizophrenia and other formal thought disorders, one may see significant delays in the ability of the individual to respond to a question. Internally, they may have a thought to express; however, it is difficult for them to transition from a thought into the initiation of speech. Other times, they may initiate a statement, only to stop prior to completion. While this happens to all of us at some point or another (when you lose your train of thought, and discontinue your sentence), it is significantly more pronounced during episodes of disorganized thinking. The interruption may be permanent, to the point the individual even forgets the original topic they were speaking about.
In manic episodes and other situations where speech is rapid (for example, someone under the influence of meth or cocaine), the latency period is impaired in the other direction. The speech may be so fast it is difficult to understand, and in signifiant cases, the individual is unable to slow themselves down. It is almost like hitting a fast-forward button on someone. Again, someone may exhibit this under less significant circumstances (i.e. excited about something, anxious, etc.), but usually people in those situations can respond to requests by others to slow down their pace. In full manic episodes, the individual is less likely to be able to control their rate of speech.