Of course, substantial uncertainty surrounds various specific estimates, but there should be no doubt that the FOMC’s forceful actions helped mitigate the consequences of the crisis and thereby spared American families and businesses from even greater pain.
In a breathtaking turn of events, the financial landscape changed dramatically, with the failure or rescue and effective nationalisation of a number of systemically important financial institutions in the United States, the United Kingdom and continental Europe. Share markets slumped, currencies moved abruptly, commodity prices continued their sharp decline and investors’ appetite for risk contracted further.