Fed's Powell Says Leveraged Lending Doesn't Pose Systemic Risk to Banks

The video discusses the leveraged loan market and its potential risks. While it doesn't pose systemic risks, it could lead to macroeconomic issues during economic downturns. Companies with high debt may struggle, amplifying downturn effects. Banks have reduced their exposure to these risks through improved supervision and risk management, unlike before the financial crisis.

What are the potential risks associated with leveraged loans during an economic downturn?

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What supervisory focus is important regarding leveraged loans and systemic vulnerabilities?

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In what ways can leveraged loans amplify the effects of an economic downturn?

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How do banks manage their exposure to highly levered non-financial corporations?

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What changes have banks made in their management of leveraged loans since the financial crisis?

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