Beth Hammark, the governor of the US Federal Reserve Bank of Cleveland, said that she is currently focusing on three areas that may affect US financial stability, including the level of leverage in the US Treasury bond market. While attending an event in Dayton, Ohio on Thursday, Hamack said, “We have a large amount of outstanding debt, and these debts are purchased with a lot of leverage.” “Buyers of these debts actually borrow money to buy them, so from this perspective, this may cause some instability in the financial system,” she said. She also said that judging from the current situation in the National Assembly, “I see no sign of a drastic return to fiscal discipline.” Hamak said that the growth of private credit is another area that needs attention. She said that in some ways, this is a good thing because private credit has a relatively stable source of capital and will not face the same pressure to redeem deposits as banks. However, she pointed out, “We lack sufficient transparency, and we don't know what credit standards these institutions use when issuing part of the loans.” She added that this means there may be more high-risk loans in this area. Hamak said the third area she is concerned about is the development of artificial intelligence. She said, “A large amount of capital was invested in this field in a short period of time, which is reminiscent of the telecom infrastructure construction boom in the 90s of the last century. Are we entering a bubble?” She also said, “We're seeing these hyperscale technology companies start to finance investments through loans. If these investments end up not being as profitable as they expected, could there be a retracement?” Hamak concluded that all three aspects are her concerns to see how they might affect the financial system.

Beth Hammark, the governor of the US Federal Reserve Bank of Cleveland, said that she is currently focusing on three areas that may affect US financial stability, including the level of leverage in the US Treasury bond market. While attending an event in Dayton, Ohio on Thursday, Hamack said, “We have a large amount of outstanding debt, and these debts are purchased with a lot of leverage.” “Buyers of these debts actually borrow money to buy them, so from this perspective, this may cause some instability in the financial system,” she said. She also said that judging from the current situation in the National Assembly, “I see no sign of a drastic return to fiscal discipline.” Hamak said that the growth of private credit is another area that needs attention. She said that in some ways, this is a good thing because private credit has a relatively stable source of capital and will not face the same pressure to redeem deposits as banks. However, she pointed out, “We lack sufficient transparency, and we don't know what credit standards these institutions use when issuing part of their loans.” She added that this means there may be more high-risk loans in this area. Hamak said the third area she is concerned about is the development of artificial intelligence. She said, “A large amount of capital was invested in this field in a short period of time, which is reminiscent of the telecom infrastructure construction boom in the 90s of the last century. Are we entering a bubble?” She also said, “We're seeing these hyperscale technology companies start to finance investments through loans. If these investments end up not being as profitable as they expected, could there be a retracement?” Hamak concluded that all three aspects are her concerns to see how they might affect the financial system.