Reference News Network reported on September 26 that the British "Financial Times" website published an article entitled "The Next Financial Crisis May Come Soon" on September 24, the author is Gillian Tate. The article pointed out that worries about the financial crisis have depressed business sentiment. In addition, perhaps the financial industry’s troubles existed before the epidemic. The article is excerpted as follows:

  What do you think is the probability of a new financial crisis? This month, data processing experts from Oxford Economic Consulting in the United Kingdom raised this question to 162 global companies. On average, they believe that the probability of a new financial crisis occurring in the next two years is 20%.

  This probability is twice the risk of the second wave of the new crown epidemic in the world, and sadly, it is also twice the probability of an early effective vaccine.

  These worries have had tangible consequences: in this month’s Oxford survey, they depressed business sentiment, below the level supported by hard data. Jamie Thompson, the economist in charge of the survey, said: "Our analysis shows that worries about the financial crisis are the main cause of pessimism."

  This should cause investors to be concerned, although it is not because a financial crisis may suddenly break out right now-at least not in a way that has attracted much media attention as it did in 2008. At least two factors will reduce this risk.

  First, the Federal Reserve and other central banks have made it clear that they will do "every effort" to keep the market running during the epidemic. The March situation is a case in point: when the US Treasury bond market froze, the Fed quickly stepped in and provided unusual liquidity support.

  Second, banks are not the source of this year's economic shock. In the United States and most European countries, the capital situation of banks is much better than in 2008. Senior Federal Reserve official Randall Quarles said: “The major U.S. banks entered this crisis in good condition. The Fed has taken many important measures to help strengthen banks’ resilience.” Or as the financial data group Morningstar said: The risk of bankruptcy and capital crises in the US financial system appears to be much lower."

  However, there is a problem here: financial crises do not always occur in the same way that Lehman Brothers collapsed. Sometimes, financial pressure will appear in a more obscure way. Purists may argue critically whether this situation is considered a "crisis." But the point is that long-term pressure may lead to the gradual failure of the economy, as the Oxford survey respondents recognized.

  As the chief economist of the World Bank Carmen Reinhardt mentioned, one problem that plagues the financial industry is that before the outbreak of the new crown, many institutions had high leverage. She said in a webinar: "If you look at the vulnerability of the financial sector, it is difficult to be optimistic in the long run."

  What's more, as the new crown pneumonia continues to raging, it is still impossible to calculate the scale of credit losses ultimately caused by the epidemic, especially because the generally implemented loan repayment policy will cover most of the losses. Shin Hyun-song, an economist at the Bank for International Settlements, pointed out: “Although banks are not the source of the crisis, they cannot expect to be unharmed. The current liquidity phase of the crisis is giving way to the solvency phase, and banks will undoubtedly be under major pressure.”