Ms. Yellen has expressed worry that defaults on leveraged loans could exacerbate the next recession. In part, this was a response to previous deregulation under the Trump administration, as The Post’s Damian Paletta has reported. And the ultimate source of the leveraged lending is precisely the non-bank sector, whose supervision would now be further relaxed. Probably not is the answer Mr. Powell gave in a May 20 speech. It took some guts for Mr. Powell to say this, given the price he will pay if his confidence, hedged though it was, is not borne out.

Source: Washington Post May 27, 2019 21:45 UTC