We have worked closely with the private sector to strengthen the clearing and settlement infrastructure and to understand how these markets will function under stress. But my emphasis today will be not the structure or mechanics of credit markets but rather the information contained in the prices we observe in these markets.
We at the Federal Reserve use this information in nearly every area of our responsibility. For example, in our roles as bank supervisors and protectors of financial stability, we monitor the credit spreads of financial institutions as early warning signs of possible financial stress.