Millions of Americans lost their homes. And distress was not limited to the U.S. economy: Global trade and economic activity contracted to a degree that had not been seen since the 1930s. The economic recovery that followed, despite extraordinary policy actions, was painfully slow. What the crisis revealed and how policymakers have responded These painful events renewed efforts to guard against financial instability.
The Congress, the Administration, and regulatory agencies implemented new laws, regulations, and supervisory practices to limit the risk of another crisis, in coordination with policymakers around the world. The vulnerabilities within the financial system in the mid-2000s were numerous and, in hindsight, familiar from past financial panics.