Leveraged Lending Isn't Posing Crash Threat, Fed Chairman Says

The video discusses financial risks, focusing on business debt and the strength of the financial system. It highlights concerns about leveraged loans, the unknown holders of such debt, and the implications of increased global debt. Chairman Powell's remarks on debt ratings and the trend of lighter covenants are examined. Despite strong corporate profitability, potential future crises are acknowledged. The issue of liquidity mismatch in mutual funds and long-term debt is also addressed.

What trend is observed regarding the covenants associated with leveraged debt?

What potential issue arises from liquidity mismatch in the financial system?