OECD: Ten years after the Lehman bankruptcy, what is the biggest danger?

All public commentary marking the tenth anniversary of the bankruptcy of Lehman Brothers in September 2008 has mentioned the risk of another financial crisis due to the continued rise in debt ratios, expansionary monetary policies and the risk of new asset price bubbles, the rise of “shadow banking” (i.e. non-bank finance) and the continued existence of very large systemic banks. We look at OECD countries but not China or other emerging countries, where the situation is different. What is the biggest financial risk today in OECD countries? Private sector debt (households, companies) and the size of banks and bank credit have fallen significantly. The stock of complex financial products has also fallen considerably; Real estate prices and share prices do not seem to be excessive on the whole ; A crisis caused by the interaction between private sector debt and real estate or financial asset prices (like in 2000 or 2008) therefore seems unlikely in OECD countries ; It is the interaction between public debt and monetary policy that should be the concern: the expansionary monetary policy prevents a public debt crisis but at the same time helps expansionary fiscal policies remain in place. A withdrawal of the expansionary monetary policies would lead to a public debt and fiscal solvency crisis.