The same as before the global financial crisis in Summers

Risks are piling up in global financial markets, as in August 2007, said former US Treasury Secretary Larry Summers (pictured). The fall in the British pound and government bonds (gilts) is a breakdown that shows potential fall risk.

Professor Summers of Harvard University appeared on Bloomberg TV on the 29th (local time) and said, “It’s a high-risk period. The anxiety is getting worse.” The summer of 2007 marked the first signs of the collapse of the real estate bubble in the United States due to the subprime mortgage crisis. It turned into the worst financial crisis since the Great Depression the following year.

“With the exception of the UK, there are no signs of a crisis at the moment, but the situation could worsen when volatility is extreme,” said Professor Summers. He analyzed that the variables that increase volatility are: △ massive leverage (debt) △ uncertainty about the economic policy outlook △ high underlying inflation △ Russia’s invasion of Ukraine and geopolitical tensions over China and Taiwan △ volatile commodity prices.

Reporter Jeon Jeon-ri [email protected]

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