And this past Monday, we took action to counteract potential effects on confidence in the aftermath of the extraordinary events in the United States, by lowering our key policy rate outside our normal schedule of announcement dates. Clearly, the events in the United States have increased the uncertainty surrounding global economic prospects in the short run.
Plans recently put forward by the President’s National Commission on Fiscal Responsibility and Reform and other prominent groups provide useful starting points for a much-needed national conversation about our medium- and long-term fiscal situation. Although these various proposals differ on many details, each gives a sobering perspective on the size of the problem and offers some potential solutions.