Yellen Warns Another Financial Crisis Is Brewing

- 'Gigantic holes in the system' warns former Fed Head- Interest rates will remain lower than they have been in past- Leveraged loans pose risks and there is unfinished regulation- "I think things have improved, but then I think there are gigantic holes in the system"- No new financial crisis in 'our lifetimes', Yellen said only last year- Editors note: Yellen should know as she and her predecessors are responsible for some of the "gigantic holes"

Image Source: Mike Shedlock

Former Federal Reserve Chairperson Janet Yellen told an audience in New York that she fears there could be another financial crisis brewing.

She warned of leveraged loans and the inability for the Fed to bail out banks. She said that banking regulators have seen reductions in their authority to address banking and financial panics and warned of the current push to deregulate.

"I think things have improved, but then I think there are gigantic holes in the system," Yellen warned Monday evening.

"The tools that are available to deal with emerging problems are not great in the United States," she said in a discussion moderated by New York Times columnist Paul Krugman at CUNY.

Yellen warned that leverage loans are an area of concern, something also mentioned by the current Fed leadership.

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