In 2007, the American real estate credit bubble collapsed and took the world down to the worst economic crisis since 1929. More than a decade later, Jens Magnusson, household economist at the Swedish bank SEB, thinks European banks are now better capitalized, the household debt legislation is different in Europe than in the United States and that we have learnt a lot from the 2007 crisis. But as the economist says, "You never know what the next crisis will look like".
euronews: It sounds a lot like something we've seen 10 years ago, in the US, with households with high debt to income ratio, not being able to pay their mortgage. Have we learnt our lessons from 2008?
Jens Magnusson: Well, that's an important question, to which we don't really have the answer. Yes we have learnt a lot, and to start with, we have a different system in Sweden. We don't really have the American system, where you, as a homeowner, can sort of leave the key to the bank and then you're debt free, and you can go and do other things. In Sweden, your debt will go with you. So it's harder to get rid of your debt in Sweden which of course can be bad for the individual. But in a financial stability perspective, it's a good thing because you won't just hand over your bad debt to banks or whatever. Another part of this situation... have we learnt a lot of things? We have learnt a lot. We have all these regulations, we have much higher capital requirements, the banks are much safer, and more cautious in their lending. But you never know what the next crisis will look like. And we don't know if we'll have learnt the right thing and if we've regulated the right thing. You can never have those guarantees.