Global income, trade and industrial production had fallen more sharply in the first twelve months of this crisis than in the first twelve months of the Great Depression. Two years after the crisis, much of the world is still in a recovery phase. And there are apprehensions that there may be a permanent loss of output – a new normal as it were.
So, on all parameters, the depth of the crisis, the length of the recovery and its lasting impact, this crisis has taken a devastating toll on global growth and welfare – conclusive evidence of why financial stability is vital from a macroeconomic perspective. 9.