The Business Times
business-time-50
PERSPECTIVE

Cheap money’s distortions remain, not least in life insurance

As the US Federal Reserve cuts rates, markets are rallying – but there are long-term risks from experiments

google-preferred-sourceAdd BT as a preferred source
    • With private equity groups moving into the insurance sector, there are worries that when interest rates rise in the future, or a slowdown occurs in the private capital world, unexpected losses could emerge that would create a domino effect.
    • With private equity groups moving into the insurance sector, there are worries that when interest rates rise in the future, or a slowdown occurs in the private capital world, unexpected losses could emerge that would create a domino effect. ILLUSTRATION: PIXABAY

    Gillian Tett

    Published Fri, Sep 20, 2024 · 05:05 PM

    ARE we back to “normal”? That is a question many investors might now ask, after the US Federal Reserve cut interest rates by a whopping 50 basis points this week.

    After all, ever since the 2008 crisis, finance has been in a deeply abnormal state. First, central banks slashed rates to stave off depression, then they doubled down when the pandemic hit – before finally raising in panic when inflation exploded.

    Now the Fed is cutting rates in response to slower growth. This looks more like the pre-2008 financial cycles. No wonder markets are rallying in relief.

    PerspectiveUS Federal ReserveInsurance

    TRENDING NOW

    Eugene Lai (left) says that he was sharing a view with Tan Chian Khong that the board needed a refresh and that it was not an explicit direction to resign.

    CSE Global independent director quits after clashes with chairman Eugene Lai over board refresh

    Siranudh Scott had caused an internet sensation with a video accusing his brother of allegedly abusing him during his childhood years.

    ‘I felt like dying’: Thai Singha beer scion speaks up after disclosure of alleged sexual abuse

    (From left) Dushan county’s ambitious Shuisi Building project and an unfinished, full-scale replica of the Titanic in Daying county.

    Abandoned ‘Titanic’, failing ‘ancient towns’: Why China’s tourism boom leaves white elephants behind

    In the last round of bidding, the premium for Category B was S$980 more than that for Category A.

    Cat A COE rate exceeds Cat B for third time in 4 months; premiums largely down

    Latest T-bills Treasury Bills Results & Interest NewsLatest SSB Singapore Savings Bonds NewsLatest COE Certificate of Entitlement News
    Latest Johor-Singapore SEZ NewsLatest BTO Build To Order & Sales of Balance NewsLatest STI Straits Times Index NewsLatest SGX Dividends, Share Price NewsLatest Bonds Market NewsLatest Singapore Stocks To Buy NewsLatest Singapore Economy News
    View More