However, the sheer scale of financial globalisation in recent years has led to a rethinking of the trilemma. Hélène Rey2, for example, has posited the existence of a global financial cycle that is strongly related to monetary conditions in the US and to changes in uncertainty and risk aversion.
It is argued that, because credit cycles and capital flows respond to global factors, they may be inappropriate for the prevailing cyclical conditions of many economies. This implies that, for some countries, the global cycle can lead to excessive credit growth when the economy is booming and excessive contraction during a downturn.