The outgoing Bank of Israel governor offered a dire warning on Wednesday to her successor: Be prepared for the next economic crisis.
“The economy’s resilience must be improved by many measures because no one knows where the next crisis will come from,” Karnit Flug told the Hebrew business site TheMarker about her successor, University of Pennsylvania economist Amir Yaron.
“To a large extent, what helped Israel in the [2008] crisis was strong and conservative banks, and the government debt, the long-term decline of which gave the government room to raise the deficit without the markets being moved,” she said.
Approved by a special appointments panel on Thursday, Yaron will begin his five-year term on Nov. 12.