“Be Very, Very Careful” – UBS CEO Warns Policy Makers Risk Bursting The Asset Bubble

Tuesday, July 23, 2019
By Paul Martin

by Tyler Durden
Tue, 07/23/2019

The world’s largest central banks are preparing for a policy u-turn, some have questioned whether ‘more of the same’ from the ECB will be enough to revive the continent’s moribund economy. In fact, BlackRock CEO Larry Fink speculated that the ECB would need to start buying stocks for its stimulus to have any impact – though he acknowledged that there would be repercussions.

On Tuesday, just hours after his bank reported its best Q2 results in nine years, UBS Chief Sergio Ermotti sat down for an interview with Bloomberg and warned that the next round of monetary easing, which could begin with the ECB later this week, might risk bursting the tremendous asset bubble that has formed over the past decade of QE-driven policy.

“I’d be very, very careful about growing further the balance sheet of central banks,” Ermotti said. “We are at a risk of creating an asset bubble.”

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