The Bank for International Settlements has noted the risk of a 1930s-style economic slump has been heightened by “euphoric” markets tapping cheap global credit. The bank said the conditions which led up to the Great Depression of the 1930s and the Asian crises in the 1990s were reflected in the current environment.
The bank’s concern about the development of asset bubbles in real estate and share prices was mirrored by participants at a World Economic Forum on East Asia conference in Singapore yesterday.
“There is a high degree of complacency, coming out of the long period of low interest-rate environment, and a low volatility environment,” Singapore’s Second Finance Minister, Tharman Shanmugaratnam, said.
» Great Depression fall looms – Sydney Morning Herald, 26th June 2007.