The future of technology advance may be difficult to predict, but for the period ahead there is the possibility that already proven technologies may not as yet have been fully exploited. Company after company reports that, when confronted with cost increases in a competitive environment that precludes price increases, they are able to offset those costs, seemingly at will, by installing the newer technologies.
This trend is explained, not least, by increased leverage in the corporate sector, particularly in emerging market economies. Complacency with regard to the resilience of the financial system is thus a risk, and assessment of debt sustainability might be overly positive. Moreover, measuring risks and the associated losses when these risks materialize is difficult.