Part 8/8:
In essence, the CRT/SRT schemes, which are supposed to spread out risk more broadly, could end up making the system more rigid and procyclical. As the credit cycle continues to deteriorate, the potential rug pull from the CRT/SRT market could become a lot worse, adding further headwinds to an economy that is already facing significant challenges.
This is in addition to the other cyclical warnings, such as the movements in the US dollar exchange rates, which have also been signaling potential trouble ahead.