The global financial system is vulnerable to shocks amid a recent surge in the price of shares and other assets, Bank of England governor Andrew Bailey has warned.Bailey, chairman of the Financial Stability Board (FSB), the fiscal risk watchdog for the G20 group of nations, urged greater multilateral co-operation between nations to help support global financial systems.In a letter to G20 ministers, he said that increased debt levels and a failure to fully implement agreed financial reforms would lead to increased vulnerability.Bailey cautioned that there could be a “disorderly adjustment”, i.e.

a slump in asset prices from recent highs.While most jurisdictions have seen a rebound in financial markets in recent months, valuations could now be at odds with the uncertain outlook, leaving markets susceptible to a disorderly adjustment.His warning comes after Wall Street stocks fell at their fastest rate for six months following a strong period of increases.On Friday, stocks sold off after Donald Trump threatened new US tariffs on Chinese imports.Jamie Dimon, the boss of JP Morgan, is among those who have warned that there is a significant risk of a slump in stock valuations in the next six months to two years.

The chance of the US stock market crashing is far greater than many financiers believe, the head of America’s largest bank said last week.Ahead of the latest International Monetary Fund (IMF) meeting in Washington and the release of its global outlook, Bailey said reforms by the FSB are key to ensuring continued financial stability.The reforms put in place by the FSB and other standard-setting bodies since 2009 have helped contain the fallout from more recent crises, including the Covid-19 pandemic, Russia’s illegal full-scale invasion of Ukraine and the swift resolution of the 2023 banking turmoil.The need for such global standards and co-operation is as clear today as it was 15 years ago - not just to prevent crises but because, ultimately, a resilient system allows for the efficient allocation of capital and supports G20 member economies in boosting growth.Before we go:Car manufacturers decided they would rather cheat to prioritise “customer convenience” and sell cars than comply with the law on deadly pollutants, the first trial day of the largest group action in English legal history has been told.

More than a decade after the original “dieselgate” scandal broke, lawyers representing 1.6 million diesel car owners in the UK argue that manufacturers deliberately installed software to rig emissions tests.They allege the “prohibited defeat devices” could detect when the cars were under test conditions and ensure that harmful NOx emissions were kept within legal limits, duping regulators and drivers.Should the claim be upheld, estimated damages could exceed £6bn.The three-month hearing that opened at London’s high court on Monday will focus on vehicles sold by five manufacturers - Mercedes, Ford, Renault, Nissan and Peugeot/Citroen - from 2009.

In “real-world” conditions, when driven on the road, lawyers argue, the cars produced much higher levels of emissions,The judgment on the five lead defendants will also bind other manufacturers including Jaguar Land Rover, Vauxhall/Opel, Volkswagen/Porsche, BMW, FCA/Suzuki, Volvo, Hyundai-Kia, Toyota and Mazda, whose cases are not being heard to reduce the case time and costs,Lawyers for the defendants will make opening statements later this week,The car manufacturers deny having used prohibited defeat devices,On Wall Street, stocks have extended gains, with the tech-heavy Nasdaq rising by 2%, reversing some of Friday’s heavy losses, when it closed 3.

6% lower.Investor’s fears over the US-China tariff war (which triggered the sell-off) have subsided somewhat, after Donald Trump adopted a more conciliatory tone on Sunday.European markets have staged small gains, while Asian stocks tumbled overnight.The global financial system is vulnerable to shocks amid a recent surge in the price of shares and other assets, Bank of England governor Andrew Bailey has warned.Our other main stories:Thank you for reading.

We’ll be back tomorrow,Take care – JKGreenpeace is threatening to sue King Charles’s property management company, accusing it of exploiting its monopoly ownership of the seabed,The environmental lobby group alleges the crown estate has driven up costs for wind power developers and boosted its own profits, as well as the royal household’s income, due to the “aggressive” way it auctions seabed rights,The crown estate, as the legal owner of the seabed around England, Wales and Northern Ireland, is responsible for auctioning offshore wind rights,It has benefited from the huge growth in the industry, commanding hefty option fees from renewable energy developers to secure areas of the seabed to build their windfarms.

It made a £1.1bn profit in its financial year ended in March, double its level just two years ago.Will McCallum, co-executive director at Greenpeace UK, said the estate should be “managing the seabed in the interest of the nation and the common good, not as an asset to be milked for profit and outrageous bonuses”.We should leave no stone unturned in looking for solutions to lower energy bills that are causing misery to millions of households.Given how crucial affordable bills and clean energy are to the government’s agenda, the chancellor should use her powers of direction to ask for an independent review of how these auctions are run.

If the problem isn’t fixed before the next round, we may need to let a court decide whether or not what’s happening is lawful,The Dutch government has said its decision to take control of a local chip manufacturer amid concerns about possible transfer of technology to its parent company in China was “exceptional” and did not come at the request of the US government,The Dutch Ministry of Economic Affairs said its intervention in Nexperia was due to “acute signals of serious administrative shortcomings and actions” at the company,It invoked never-before-used powers under a Dutch law known as the “Availability of Goods Act” which does not give it ownership but gives it the power to reverse or block management decisions it considers harmful,The move prompted a 10% fall in Wingtech’s shares in Shanghai on Monday, and the firm said in a statement it was consulting with lawyers and seeking government support to “protect the legitimate rights and interests of the company.

”Wingtech said in a stock exchange filing that its control over Nexperia will be temporarily restricted due to the Dutch order and court rulings, affecting decision making and operational efficiency.Nexperia’s Chinese chairman Zhang Xuezheng was suspended from Nexperia’s boards by an Amsterdam court order on 6 October, and an independent non-Chinese person with a “deciding vote” would be appointed in his place, Wingtech said.Wingtech bought the firm, previously as subsidiary of Dutch giant Philips, in 2018.It was placed on a list of potential national security concerns in the US last year but at the time it said it would comply with US rules arguing its Dutch operations were kept at arm’s length from Wingtech in Shanghai.Wall Street has rallied at the open, after Friday’s heavy sell-off, as fears over a new trade war between the US and China eased.

The Dow Jones rose by 1%, the S&P 500 climbed by 1,2% and the Nasdaq jumped by 1,7% at the opening bell in New York,With nearly a month to go before the deadline for the US and China to reach a deal in their trade war, goodwill between the two countries appears to have been swept off the table in recent days,China announced last week that it was once again restricting the export of critical minerals, prompting the US president, Donald Trump, to announce tariffs of 100% on US-bound Chinese exports.

He then softened his language towards Beijing in a social media post on Sunday.The global financial system is vulnerable to shocks amid a recent surge in the price of shares and other assets, Bank of England governor Andrew Bailey has warned.Bailey, chairman of the Financial Stability Board (FSB), the fiscal risk watchdog for the G20 group of nations, urged greater multilateral co-operation between nations to help support global financial systems.In a letter to G20 ministers, he said that increased debt levels and a failure to fully implement agreed financial reforms would lead to increased vulnerability.Bailey cautioned that there could be a “disorderly adjustment”, i.

e.a slump in asset prices from recent highs.While most jurisdictions have seen a rebound in financial markets in recent months, valuations could now be at odds with the uncertain outlook, leaving markets susceptible to a disorderly adjustment.His warning comes after Wall Street stocks fell at their fastest rate for six months following a strong period of increases.On Friday, stocks sold off after Donald Trump threatened new US tariffs on Chinese imports.

Jamie Dimon, the boss of JP Morgan, is among those who have warned that there is a significant risk of a slump in stock valuations in the next six months to two years.The chance of the US stock market crashing is far greater than many financiers believe, the head of America’s largest bank said last week.Ahead of the latest International Monetary Fund (IMF) meeting in Washington and the release of its global outlook, Bailey said reforms by the FSB are key to ensuring continued financial stability.The reforms put in place by the FSB and other standard-setting bodies since 2009 have helped contain the fallout from more recent crises, including the Covid-19 pandemic, Russia’s illegal full-scale invasion of Ukraine and the swift resolution of the 2023 banking turmoil.The need for such global standards and co-operation is as clear today as it was 15 years ago - not just to prevent crises but because, ultimately, a resilient system allows for the efficient allocation of capital and supports G20 member economies in boosting growth.

Our top story: Three experts in the power of technology to drive economic growth have been awarded this year’s Nobel prize in economics.Joel Mokyr of Northwestern University secured half of the 11m Swedish kronor (£867,000) prize, with the rest split between two other academics: Philippe Aghion of the Collège de France, Insead business school and the London School of Economics; and Peter Howitt of Brown University.Announcing the prize against a backdrop of rapid development in artificial intelligence and fierce debate over its impact on society and living standards, the Royal Swedish Academy of Sciences said the trio had pioneered the explanation of “innovation-driven economic growth”.The award came as countries worldwide push to turn around years of lacklustre economic growth since the 2008 financial crisis, amid concerns over a slowdown in productivity gains, sluggish progress on raising living standards, and mounting political tensions.Aghion, a French economist, warned that “dark clouds” were gathering amid increasing barriers to trade and openness fuelled by Donald Trump’s trade wars.

He also said innovation in green industries, and blocking the rise of giant tech monopolies would be vital to stronger growth in future,“I’m not welcoming the protectionist wave in the US, and that’s not good for world growth and innovation,” he said,Here’s some reaction to the Nobel economics prize,Brian Albrecht, chief economist at the International Centre for Law & Economics, said:🚨 2025 Nobel Prize in Economics goes to Mokyr, Aghion and Howitt 🚨"for having explained innovation-driven economic growht"The best prize in years! pic,twitter.

com/BNiw5VOq8NJostein Hauge, political economist and assistant professor at Cambridge University, said:This year’s Nobel Prize in Economics is a farce.There’s an entire field of innovation studies — building on Schumpeter’s insights — that *actually* explains innovation-driven economic growth.This field is full of brilliant economists.But apparently, they’re considered too… https://t.co/btd808RFXgThe Rockwool Foundation in Berlin said:We sincerely congratulate Philippe Aghion, Peter Howitt & Joel Mokyr on winning this year’s #NobelPrize in Economic Sciences!Research and innovation are the roots of renewal — enabling the welfare state to bloom anew and create progress for all! pic.

twitter,com/czo3JMlIOPWall Street futures are pointing to a higher open, with the Dow Jones seen rising by 0,9%, the S&P 500 by 1,3% and the Nasdaq by 1,8%, as concerns over the US-China trade spat have eased, with Donald Trump softening his language towards Bejing yesterday.

He is of course in Israel now, addressing the Knesset at the moment, where he declared the end of the “age of terror and death”.The German, French, Italian and Spanish stock markets have increased by between 0.3% and 0.5%, while the FTSE 100 index has dipped slightly.In Asia, shares tumbled on concerns over trade tensions.

Here’s our full story on the markets:Lloyds Bank has put aside an extra £800m to deal with possible compensation claims over the motor finance scandal, with its total provision rising to almost £2bn,Our other stories today:Turning to AI, Aghion was optimistic that it would help boost economic growth, and that it will ultimately be positive for employment, despite fears of massive job losses,AI has a big growth potential because AI automates tasks, both in the production of goods and services and in the production of ideas,The problem is to harness this potential… If we don’t have appropriate competition policy, we will inhibit the growth potential,Of course, there is a big fear that AI will destroy a lot of jobs, but that’s why it’s important to have a good education system because at school we learn to learn… We should emulate Sweden and Denmark on that front.

When you have a revolution like AI, there is the fear of unemployment, it’s true that machines substitute for humans, but on the other hand, it allows you to become much more productive, and therefore it increases the world market demand for your products, and that allows you to increase employment.Aghion said he would use his quarter share of the prize money – a total of 11 million Swedish kronor – to fund projects at his research lab at the Collège de France, where he and his team of younger researchers look at growth and artificial intelligence, green growth and R&D policy.He said:Tariff barriers, those things are obstacles to growth, because you need a big market to grow more.A bigger market means more grants for innovators, more possibilities to exchange ideas, you can transfer technologies, it means more competition.So openness is a driver of growth.

Anything that gets in the way of openness is an obstacle to growth,So I see dark clouds currently accumulating, pushing for barriers to trade and openness,He then addressed green growth and AI,Okay, so that’s one thing,The other, of course, concern is green growth – we want to reconcile growth with the environment.

So how can we make sure that we will innovate greener? Firms do not spontaneously innovate green.If they are used to innovating in dirty technologies, they will continue to innovate in dirty technologies.How can you redirect technical progress towards green carbon price, carbon tax, green industrial policy; how should we design these policies?So that’s a fantastic challenge in front of us, and AI has fantastic growth potential, but we know that with inappropriate competition policy, the same as with IT can happen.Some superstar firms may end up dominating everything and inhibiting potential entry of new innovators.So how can we make sure that today’s innovators will not stifle future entry and future innovation?The committee phoned professor Philippe Aghion, who said that it was “quite a surprise” and he was “still speechless”.

“I did not expect it at all.”He was asked about about trade tariffs and their impact on economic growth.He said:I’m not welcoming the protectionist wave in the US, okay? And that’s not good for world growth and innovation.But on the other hand, let’s look at the bright side.European countries have to realise that we should no longer let the US and China become technological leaders and lose to them