These are the areas where markets are complacent and risks lurk

Last Updated: June 23, 2025 at 10:02 a.m. ET
First Published: June 23, 2025 at 9:46 a.m. ET

Economist Hyman Minsky argued that stability itself was a destabilizing force in financial markets because it bred complacency and whetted risk appetite. A report published Monday by Deutsche Bank’s macrostrategist Henry Allen argued that investors are overlooking certain risks. He highlighted the dislocations that have built up in markets and may be ripe for correction.

The most obvious area where traders ignore risks at their peril is the inflation outlook. Deutsche’s note highlighted how the risk isn’t just represented by geopolitical turbulence and booming oil prices, but also by the threat of fresh U.S. tariffs with the reciprocal arrangement set to expire on July 9. Not only that, but in Europe, there is significant fiscal stimulus as military spending is boosted and the European Central Bank has cut rates eight times in the last year.  

About the Author

Jules Rimmer is a markets reporter in London.Rimmer spent more than 30 years as a trader and stockbroker in financial markets, starting at Salomon Brothers in the Liar's Poker era, taking in ING Barings, Jefferies and ending it in emerging markets at Investec. He hung up his headset and pivoted to journalism in 2021.