"Governor Cook Addresses Financial Stability and Nonbank Risks in Fed Speech"

Governor Cook delivered a speech at Duke University emphasizing the importance of financial stability and the role of the Federal Reserve in monitoring vulnerabilities in the financial system. While acknowledging the increased resilience of the financial system compared to the mid-2000s, Cook highlighted several risks, including valuation pressures in asset markets, excessive borrowing by businesses and households, financial-sector leverage, and funding risks. He also discussed the potential impact of near-term risks such as higher interest rates, stress in nonbank financial institutions, and the implications of artificial intelligence in financial services. Cook emphasized the need for vigilance, transparency, and resilience-building measures across the regulatory agencies to ensure the stability of the entire financial system.