"There may, one day, be another crisis. I plan on having a long life, and I hope she (Yellen) does, too, so I wouldn't absolutely bet on that because there are cycles that we have seen over the past decade and I wouldn't exclude that," Lagarde told CNBC on Tuesday.She said that crises are usually unpredictable and come unexpectedly.
"Where it will come from, what form it takes, how international and broad-based it will be is to be seen, and typically the crisis never comes from where we expect it," Lagarde said.The previous global financial crisis took place in 2007-2008 and is considered the biggest economic downturn since the Great Depression.
"Our duty ... is to make sure that your financial sector is under good supervision, that it's well regulated, that the institutions are rock-solid, and anticipate at home with enough buffers so that you can resist the potential crisis," she added.
It happened after the crash in the US housing market, and massive amounts of mortgage-backed securities and derivatives lost significant value. In the US alone, more than 7.5 million people lost their jobs. According to estimates, American households lost roughly $16 trillion in net worth as a result of the stock market plunge.
Comment: Despite today's ballooning stock market, the 'real USA' has never quite recovered from the 2008 debacle, nor have those movers and shakers truly been held accountable.
Comment: It is prudent to take any financial insider's expert advice with a tall glass of common sense. Balance is how our world works and when something tilts too far one way, it rebounds in another.