Well, one possibility is that the economy might be further from its full potential than we think. In that case, the labour market would be less tight, wages would not rise, and that would hold down inflation. And indeed it seems that the headline unemployment rate doesn’t reflect some of the slack in the labour market.
As you know, these scandals created suspicion of large corporations and raised the cost of capital in international financial markets. In the final analysis, the verdict was that it was the weaknesses in a few companies and major audit firms that were responsible for the significant increase in the cost of capita across financial markets.