And, according to recent estimates by the International Monetary Fund (IMF), growth is expected to continue in the coming years (IMF 2018). Projections suggest that the world economy will expand by 3.9% in 2018, compared with 3.7% in 2017. These favorable economic outlooks, together with inflation and interest rates that remain below their historical averages, contribute to high valuations on financial markets.
As regards the regulation of financial markets, much progress has been made since the financial crisis. G20 reforms that have been agreed upon post crisis aim at enhancing the resilience of the financial system, ending too-big-to-fail, reforming derivatives markets, and transforming shadow banking into a resilient source of finance.