Persistently higher risk aversion: Far more visible effects in the euro zone than in the United States

After the subprime crisis, risk aversion was higher than before the crisis for a long time , and the COVID crisis will probably have the same effect. These are effects on financial markets and on the real economy. When we look at: Long-term interest rates; The equity risk premium; Credit spreads; Corporate investment; Household savings; Household and corporate debt , we see that the rise in risk aversion: Mainly affect ed equity markets and corporate investment in the euro zone; Mainly affect ed household savings and debt in the United States. The resulting decline s in long-term interest rates and rise s in credit spreads were similar in the United States and the euro zone.