We combine what they learn with other sources of market intelligence in a framework we developed several years ago to assess financial system vulnerabilities and risks.7 Some of you will be familiar with this framework from our biannual Financial System Review (FSR). (The most recent issue was published earlier this month.)
It helps us explicitly identify underlying weaknesses, such as high leverage, asset price misalignments or maturity and funding mismatches that could amplify and propagate shocks. For example, a few years ago we increased our focus on ETFs, particularly those related to fixed-income instruments, given their increasing popularity among investors.