Closer to home, massive financial problems, including defaults, bankruptcies, and bank failures, were endemic in America’s worst encounter with deflation, in the years 1930-33--a period in which (as I mentioned) the U.S. price level fell about 10 percent per year.
Armed with the recent impact assessments, governors and supervisors will work quickly to make progress, consistent with the direction given by G-20 leaders to be finished by the November Summit in Seoul. If we can move faster, we will. Reducing the interconnectedness between institutions and markets In effect, the measures I just described reduce the probability of failure of a given financial institution.