Gensler Sees Potential Peril in $13 Trillion of Eurodollars (1)

Wall Street’s top cop is sounding an alarm about the eurodollar market’s potential to foment instability in global economies, and he renewed warnings about risks embedded in private credit and artificial intelligence.

Much of the $13 trillion of US currency held offshore by non-US banks is uninsured, Securities and Exchange Commission Chair Gary Gensler said Tuesday during the Bloomberg Global Regulatory Forum in New York. This matters because eurodollar markets have played a role in deepening economic downturns across the globe, he said, including the 2008 financial crisis.

“There may be more work for those of us in the global ...