Loans were being shifted off balance sheets, allowing more loans to be made. If securitization led to the creation of loans that would not otherwise have been made, then this was a source of demand in the economy that we as central bankers likely did not fully take into account.
We should not forget that, only five months ago, der Spiegel, the leading German weekly magazine ran an article entitled “A continent stares into the abyss”, which declared that the end-game for the euro had begun.