However, as we all know, even at that time risks to financial stability were beginning to appear on the horizon which would later unleash massive turmoil in the financial system and trigger a severe economic crisis.
Central banks around the world responded to the financial crisis – and to the sovereign debt crisis that struck the euro area later on – by resorting to measures hitherto deemed inconceivable: by reducing interest rates to zero or even below that, by providing more or less unlimited liquidity, and by purchasing assets on a large scale.