IMF haunted by fears that history might be about to repeat itself | Larry Elliott
by Larry Elliott in Washington from Economics | The Guardian on (#4SP9N)
With corporations loading up on debt, any recession would have dire consequences
The fear that history is about to repeat itself is haunting the International Monetary Fund.
In the early 2000s, the body responsible for overseeing the global economy could see banks were taking big risks. Assuming benign market conditions would go on for ever, banks took punts with not much capital in reserve if things went bad. When they did in 2008, the result was the most profound economic shock since the 1930s. Supervision and regulation of banks was tightened, but only when it was too late.
Related: Global economy faces $19tn corporate debt timebomb, warns IMF
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