They have also generated a hitherto unimagined demand for financial services, as witnessed by the rapid expansion of the asset management industry. The emergence of a more demanding consumer of financial services and of an equally demanding shareholder is in many ways the result of the previous two forces.
It can be as simple as “when benign financial and economic conditions continue for a long time, there is a possibility that various excesses will accumulate, resulting in extremely large economic fluctuations.” Of course, it is easy to anticipate that there will be difficulties in utilizing the lessons, or “common sense”, in actual policy responses.