Risk aversion rises so often it will end up by not falling back down

Risk aversion in financial markets has been high in 1998, 2000-2002, 2008 and early 2009, 2011, 2015 and early 2016, and since the second quarter of 2018. We see that periods of high risk aversion have proliferated and become more frequent . This trend will lead financial market participants to systematically expect risk aversion to rapidly return. Consequently , risk aversion will end up remaining permanently at a high level , with the resulting negative effects for financial markets and economies ( higher risk premia and therefore borrowing costs for companies and for governments other than those deemed to be very safe). T he proliferation of crises is not without consequence .